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Institute of Innovation in Technology and Management

SUMMER PROJECT REPORT

On

A STUDY OF HUMAN RESOURCES PLANNING OFTHE EMPLOYEES IN THE ORGANISATION

Submitted in partial fulfillment of the requirement

for the award of degree of

Bachelor of Business Administration (Computer Aided Management),

SEMESTER-III(Paper Code-BBACAM 213)

TO

Guru Gobind Singh Indraprastha University

Submitted to: Submitted By:GEETIKAMALHOTRAMs.SNEHA SHARMA Enrollment no. : 04090301310

Institute of Innovation in Technology & Management,New Delhi 110058Batch (2010-2013)

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CERTIFICATE

I, Mr/Ms_______________________________, Roll No. ________________ certify that the

Minor Project Report (Paper Code-------) entitled ________________________________

is completed by me by collecting the material from the referenced sources. The matter

embodied in this has not been submitted earlier for the award of any degree or diploma to the

best of my knowledge and belief.

Signature of the Student

Date:

Certified that the Minor Project Report (Paper Code-------) entitled _________________

done by Mr/Ms__________________, Roll No. ___________, is completed under my

guidance.

Signature of the Guide

Name of the Guide:

Designation:

Date:

Countersigned

Director/Project Coordinator

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ACKNOWLEDGEMENT

First of all I would like to take this opportunity to thank the Guru Gobind Singh Indraprastha

University for having projects as a part of the B.B.A(CAM).

Many people have influenced the shape and content of this project, and many supported me

through it. I express my sincere gratitude to Ms.SNEHA SHARMA for assigning me a project

on A Study On Human Resources Planning Of The Employees In The Organisation

which is an interesting and exhaustive subject.

She has been an inspiration and role model for this topic. Her guidance and active support hasmade it possible to complete the assignment. I also would like to thank my colleagues who

have helped and encouraged me throughout the working of the project.

Name: Geetika Malhotra

Enroll no: 04090301310

Class: BBA (CAM)

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CONTENT

S.NO Topic Page Number

1 Certificate2 Acknowledgement

3 List of Tables

4 List of Figures

5 List of Symbols

6 List of Abbreviations

7 Chapter-1

8 Chapter-2

9 Chapter-3

10 Chapter-411 Chapter-5

12 Chapter-6

13 Chapter-7

14 References/ Bibliography

List of Tables

Table No. Title Page No1 Table 3.1 Demands and responses for the customer factor

2 Table 3.2 Behavioral expectations chart: organization goalexcellencustomer service.

3 Table 3.3 Staff by occupation, number and age

List Of Figures

Figure No. Title Page No1 fig .1 Human resources planning process

2

List of Symbols

S. No. Symbol Nomenclature & Meaning1

List of AbbreviationsS. No. Abbreviated name Full Name1 HR Human resources

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Chapter-1INTRODUCTION

The employment function of the personnel or human resources manager is concerned with the

task of hiring people to fill current or future job vacancies in the organization. For making the

hiring practices most effective, answer must be sought to the following question:

1. What are the requirements of the jobs to be filled?

2. What kinds of and how much manpower must be hired?

3. What sources of recruitment may be utilized for procurement?

4. What procedure should be adopted to screen the candidates for employment?

5. What is the utility of the employment test and interviews in the selection process?

6. What is the place of transfer and promotions in employment and placement?

Manpower personnel or human resources may be regarded as the quantitative and qualitative

measurement of work forces required in an organization and planning in relation to manpower

may be regarded as establishing objective to develop human resources in line with broad

objective of the organization. Manpower planning may thus be expressed as a process by

which the management ensures the right number of people and right kind of people at the right

time at the right place doing the right things for which they are suited for the achievement of

goal of the organization.

ORIGIN AND EVOLUTION

Human resource planning (HRP) has been a function of management since the origin of

modern industrial organizations. Economist, Alfred Marshall observed in 1890 that "the head

of a business must assure himself that his managers; clerks and foremen are the right men for

their work and are doing their work well." Division of labour, specialization, organization of

management into levels, work simplification, and application of standards for selecting

employees and measuring their performance were the principles applied early in industrial

management. .

The relatively sophisticated techniques available today to management are the outcome of a

long period of evolution beginning decades ago with simple, pragmatic, and short-term

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planning. During the first part of the 20th century, the focus in manpower planning was on the

hourly production worker. The aim of improving efficiency through work engineering and

early industrial psychology applications was consistent with the need to improve productivity

and to introduce greater objectivity to personnel practices.

During World War-II and the post war years, the focus intensified on employee productivity.

Concern was also shown regarding the availability of competent managerial personnel, as

there was a talent shortage combined with significant demand for goods and services.

Nonntechnology areas and interest in behavioural aspects of work added complexities to the

manpower planning task. In the 60s, manpower planning was viewed as a system linking the

organization with its environment. The prevailing view of manpower planning at that time was

that companies forecasted their needs for manpower into the future, forecasted their internal

labour supply for meeting these needs, and identified the gaps between what would be neededand what was available. Manpower planners planned for recruitment, selection, and placement

of new employees, provided for training and development, and anticipated necessary

promotion and transfers. During the late 70s, the term 'human resource' in place of 'manpower'

gained acceptance as a way o emphasizing the positive view of personnel as a basic corporate

resource. Also during these years, HRP became widely established as a staff activity in major

business and governmental organizations. During the 80s, employees' desire for participation

in decisions that affected their work and careers became stronger. Similarly, management's

desire for better control over costs and profitability also becomes stronger. As a result,

companies adopted work and career management practices of the type reflected in innovations

under affirmative action programmes.

Meaning And Nature Of The Human Resources Planning

What are human resources planning?

According to Decenzo and Robbins , Human resources planning is the process by which the

organization ensures that it has the right number and kind of people , at right place at the right

time , capable of effectively and efficiently completing those tasks that will help the

organization achieve its overall objective manpower or human resources planning aims at

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ascertaining the manpower needs of the organization both in the right number and of right

kind .it further aims at the continuous supply of right kind of personnel to fill various positions

in the organization . To quote dale s. beach, human resources planning is the process of

determining and ensuring that the organization will have adequate number of qualified

persons, available at the proper times, performing jobs which meet the needs of the enterprise

and which provide satisfaction for the individual involved.

Human Resources planning are a continuous process. It cannot be rigid or static; it is amenable

to modification, review and adjustments in accordance with the needs of the organization or the

changing circumstances. In the words of Coleman, manpower planning is process of

determining manpower requirements and the means for meeting those requirements in order to

carry out the integrated plan of the organization.

Human Resources planning are a two- phased process by which the management can project

the future manpower requirements and develop suitable action plans to accommodate the

implication of projections. Thus, human resources planning is the process of developing and

determining objective, policies and programme that will procure, develop and utilize human

resources so as to achieve the goals of the organization

Nature of Human Resources planning

The following points emerge from the study of the above definitions of human resources

planning:

1) Human Resources planning aims at ascertaining the manpower needs of the

organization both in the number and kind.

2) It presents an inventory of existing manpower of the organization .An analysis of the

inventory of manpower helps in ascertaining the status of the available personnel and

to discover untrapped talent presently available with the organization.3) It helps in determining the shortfall (or surplus) of manpower by comparing the total

manpower needs with the present supply of manpower it also helps in projecting future

manpower needs.

4) It is concerned with the ignition of various organization programmes depending upon

the demand and supply of human resources .if the future needs exceed presently

available talent , this gap becomes the for a programme of employment and training .

And, if the presently available talent exceeds to future needs, this difference may

become the basis for a programme of retirements, discharge, etc.

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5) Effective human resources planning encompasses the acquisition utilization,

improvement, and preservation of the organizations human resources.

Objective of human resources planning

The major objectives of human resources planning in an organization are as follows:

a) To ensure optimum use of human resources planning currently employed.

b) To avoid imbalances in the distribution and allocation of human resources.

c) To assess or forecast future skill requirements for the accomplishment of the

organization overall objective.

d) To provide control measure to ensure availability of necessary resources when

required.

e) To control the cost aspect of human resources.

f) To formulate transfer and promotion policies.

Scope or elements of human resources planning

The basic activities involved in the Human Resources planning are as under:.

1) Listing of current manpower or Human Resources with the organization.

2) Assessing the extent to extent to which the current manpower is utilized to the

advantage of the organization.

3) Phasing out the surplus manpower, if any.

4) Analyzing the requirements of manpower in future in the light of expansion plans,

retirement of personnel

5) Making manpower procurement plans.

6) Designing training programmes for categories of manpower.

Importance ofHuman Resources planning

Manpower planning is a two-phased process by which management can project future

manpower requirement and develop manpower plans. It helps in proper recruitment and

selection so those rights of people are available to occupy various positions in the organization

.It also facilities designing of training programmers for the employees to develop the required

skills in them. Thus manpower planning plays an important role in the effective managementof personnel.

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Systematic manpower planning provide lead time for the acquisition and training of

employees to meet future requirements it is all the more crucial because the lead time for

procuring personnel is a time consuming process and in certain cases, one may not always get

the requisite type of personnel needed for the jobs. Non availability of suitable manpower may

result in postponement or delays in executing new project and expansion ultimately

programmes, which lead to lower efficiency and productivity. To overcome this, an

organization must plan out its manpower requirements well in advance so that it could compete

effectively its competitor in the market.

Benefits of manpower planning

Manpower planning is an important tool of human resources management as it helps in the

following ways:

(a)Manpower planning results in reduced labour costs as it helps the management to

anticipate shortages and/or surpluses of manpower and correct these imbalances before

they become unmanageable and expensive.

(b)It is better basis for planning employee development that is designed to make to make

optimum use of workers skills within the organization.

(c) It enables identification of the gaps of the existing manpower so that corrective training

could be imparted .Thus; the training programme becomes more effective.

(d)It leads to improvement in the overall business planning process.

(e) It leads to greater awareness of the importance of sound manpower management

throughout the organization

(f) It serves as a tool to evaluate the effect of alternative manpower actions and policies.

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Chapter-2

MANPOWER PLANNING AT DIFFERENT LEVELS

HRP AT NATIONAL LEVEL

The notion that human resource planning is not relevant to Indian organizations as humanresource is available in plenty is not correct. In many countries including India, there are wide

variations between the availability of technically, trained manpower and the actual demand for

such personnel. On one hand, there may be severe shortage of technicians and engineers

necessary for development and on the other hand there may be a surplus of

Certain types and levels of personnel. The problem is not confined to developing countries

alone. Despite the high level of their development efforts, the developed countries still have

critical manpower shortages. These are no less serious than the problems confronting the less

developed countries, but they are the consequences of a different set of imperatives or

pressures.

The above is only a quantitative aspect. Equally important is the qualitative aspect where the

relevance of educational system to the needs of the country becomes important. The

quantitative figures in terms of head counts (for example, so many thousand engineers and

doctors pass out every year) find mention in literature but the qualitative break-up is not given,

which is very difficult to ascertain. It is in this respect that HRP differs from manpower

planning-it focuses both on the quantitative and qualitative aspects.

Thus at the national level, a proper and comprehensive HRP effort can help us identify the

levels of skills, knowledge and attitude of the young graduates passing out in different

disciplines, make a qualitative comparison of these with those of other nations, and realizethose skills, knowledge and attitudes which are lacking with us or those which are our strong

points. For instance, it is said that engineers of today find it difficult to handle a machine.

They are also not equipped to tackle human problems. Their knowledge about the problems of

this country is also minimal. Many engineering graduates from reputed institutions such as

Indian Institutes of Technology, despite their excellent theoretical grounding, are inept at

handling shop floor conditions in the Indian scenario. On the other hand, German engineers

are known for their practical engineering skills. This is because of the high emphasis placed

upon practical apprenticeship courses in their curricula. These aspects can be analyzed and

interpreted by our educationalists for developing appropriate curricula to meet the present day

needs.

HRP AT CORPORATE LEVEL

A business is an interaction of men, machines, materials and money. Machines, materials and

money appear on the balance sheet and therefore draw the attention of management and the

stakeholders. But the most critical asset of a business is its manpower. What distinguishes a

successful company from an unsuccessful one is the quality of its manpower.

The role of management is to optimize the use of resources available to it. The role of human

resource planning is to incorporate the planning and control of human resources into the

corporate level plans so that all resources are used together in the best possible combination.

The second important objective of human resource planning is to coordinate all company

manpower policies. Decisions affecting manpower are continuously being made by line

managers and personnel manager. Recruitment and training programmes, promotion andtransfer policies, and changes in methods of utilizatie)ll or in remuneration affect the future

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needs for manpower and its supply. Mostly such decisions are made in the absence of any

clear means of assessing their effects or their relevance to the objectives of the company.

Naturally those who take the decision, attempt to take all factors into account, but they rarely

have the information to do so satisfactorily.

Further, in large organizations, it is difficult to ensure that the various HR decisions harmonize

with each other. For example, has the implication of a planned change of the organization

been thought over so that the recruitment programme is suitably amended? And does thetraining programme accommodate the changes, and is the salary policy suitably adjusted to

attract the manpower needed? To do all these properly, it is necessary to translate the

objectives of the company into the personnel activities which make them achievable.

Achievement of these objectives leads to a reduction in staff costs, not only through an overall

improvement in productivity, but also through the possibility of giving training,-recruitment

and the other personnel decisions a better direction. In addition, the danger of the company's

plans failing due to not having the right people in the right place at the right time is also

obviated.

Systematic analysis of manpower resources have to be continuously made. For this, databanks

have to be set up with all relevant information regarding personnel in different grades, their

educational qualification, their experience, special aptitude, etc. Forecast of manpowerrequirements will have to be made keeping in mind the trends in productivity and business

environment.

The following steps are considered to be essential in manpower planning at the corporate

level:

Proper approach. Human resource planning has been defined as the strategy for acquisition,

utilization, improvement and preservation of an organization's manpower. Proper approach to

manpower utilization, training and development are essential for the success of a manpower

plan as is the balancing of the supply and demand of manpower.

Manpower inventory. An inventory of existing manpower should be made. The principal

dimensions of this inventory could be:

(i) Job family inventory-department or function-wise

(ii) Qualification and training

(iii) Experience and skills(iv) Age-distribution of the employed personnel

(v) Salary grades

Estimation of current supply and forecast of changes required. For estimating the current

supply of manpower in an organization, it is not sufficient to get an idea about the total

number of persons employed and their distribution among different departments and

designations. Properly made manpower supply forecast can be compared with the forecast of

future manpower requirement for arriving at the possible deficient or surplus manpower.

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Estimation of manpower demand. Various methods may be used for estimating the current

or future manpower requirement of the organization. But the appropriate procedure should be

chosen taking into account the nature of organization and its principal activities.

Corroding the imbalances between demand and supply of manpower. Demand and supply

of manpower in an organization has to be compared not only as a whole for the entire

organization but for each functional category or job facility.If the demand for a particular

category of manpower over a certain forecasting period exceeds the available supply, a

decision has to be taken regarding the way of filling that gap. In some organizations, either as

a matter of management policy or due to a collective agreement, all vacancies above a certain

level are filled through internal sources and recruitment is permitted only if the internal sourcecannot meet the need. In case of direct recruitment, the manpower planner has to prepare,

partly or wholly, the plan for training and development and also the recruitment plan for the

particular categories involved. If in an organization, the manpower is found surplus then the

problem becomes more complicated. The main approaches which may be followed. I to

address the problem of surplus in specific categories of manpower are redeployment in the

form of transfer, or long-term orientation or training or retrenchment or attrition. Care must be

taken to avoid any industrial frictions and to reduce bitterness.

The process of human resources planning

The process of manpower planning involves the following steps:

1) Determination of objective of manpower planning.

2) Preparation of current manpower inventory.

3) Demand forecasting.

4) Supply forecasting.

5) Estimating the net manpower requirements.6) Action plan for redeployment and redundancy.

7) Determination of job requirement of job to be filled.

8) Employment plan.

9) Training and development program.

Manpower planning is a continuous process as shown in fig1.The manager

responsible for manpower planning has to be concerned with all the steps at all time

.He may have to revise employment plan and training and development programme

from time to time depending upon the changes in circumstances such as sudden

changes in volume of production, unpected high rate of labour turnover, obsolescence

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of existing skills and so. A brief explanation of the steps in the manpower planning

process is given below:

Fig.1 Human Resources Planning Process

1.Objective of manpower planning

The ultimate purpose of manpower planning is to relate future human resources to future

enterprise need so as to maximize the future return on investment in human resources.

Manpower planning must be integrated with the overall organizational plans. Manpowerplanning should be done carefully as it has got longterm repercussions. Once the wrong

forecast of future requirement of human resources and the wrong analysis of the available

manpower inventory are made , it may not be possible to rectify the errors in the shortrun.

Therefore, manpower planning should be more concerned with filling future vacancies with

right type of people rather than with matching existing personnel with existing jobs.

2.Current manpower inventory

Analysis of current manpower supply may undertaken by department, by function, by

occupation ,or by level of skill or qualification . Appropriate adjustments in these would needto be made in the light of any foreseeable changes in weekly hours of work, holidays, leave

entitlements, etc. It may be noted that assessment of demand for the operative personnel

presents less problems of uncertainly and currents manpower supply can be adjusted

accordingly .But projections of manpower requirements for supervisory and managerial levels

presents a complex problem because the required talents are not available at a short notice.

This explains the need to ascertain the present manpower inventory and development plans to

meet the needs of certain skills in the future.

Systematic steps must be taken in order to ensure that a reservoir of talent is available when

vacancies occur. The search for talented employees in the organization must be continuous. Tobe sure that available talent has been included; the inventory of various skills in the enterprise

Objective Of

Manpower

Plannin

Inventory of Human

Resources skills

Demand and

Supply

forecasting Determine

Net

Manpower

Requirement

Redeployment

and

Redundancy

Plan

Employment

Plan.Training and

Development

Program

Appraisal of

HumanResources

Planning

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should be indexed. Detailed bio-data of each included in the manpower inventory must be

obtained separately for the purpose of manpower planning. This record will provide the

foundation for a progamme of individual developments. It will also reveal the scarcity or non

availability of certain talents for which outside sources of manpower may be tapped

3.Demand forecastingA purpose forecast of manpower required in the future must be attempted. The factors

relevant for manpower forecasting areas follows:

1) Employment trends :the manpower planning committee at the corporate level should

make an examination of number of the employment on the payroll during the past five

years to know the trend within each group .With the help of this, it would be possible

to determine whether a particular group has been stable or unstable and whether it

has been expanding or contracting.

2) Replacement needs: The need for replacement arises due to death retirement,

resignation and termination of employees. The examination of replacement needs may

relate to specific manpower groups: supervisory, skilled, clerical, unskilled,etc. for

some groups like managerial or supervisory ,it is very difficult to predict the needs for

managerial skill is that the management development cycle takes a long time so the

need for managerial manpower should be anticipated sufficiently in advance .

3) Productivity: An important area to which the manpower planning is related is the

improvement in productivity. Gains in productivity add to the growth potential of the

organization and can make possible healthy wage increase. Grains in productivity will

also influence the requirements of manpower.

4) Growth and expansion:Another aspect relevant for manpower planning is the

personnel requirement for growth and expansion of the organization. The expansion

plans of various plants and divisions should be carefully reviewed to assess their

probable effects on the number of employees required in each group. The accuracy

with which such manpower requirements can be achieved in relation to the expansion

programme. Where the expansion programme is less specific and the time perspectiveis large, uncertainties will also be greater.

5) Absenteeism: its means a situation when a person fails to come for work when he is

scheduled to work. The rate of absenteeism can be calculated by following formula:

Absenteeism = mandays lost

Man-days worked +man-days lost

There are certain employees who are more prone to absenteeism in any organization 10to 20 % of such employees may account for 70 to 80% of absences. It should be noted

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that excessive absenteeism involves a considerable cost to the firm even when the

absent employees receive no pay. Work schedules are upset leading to overtime work

which in turn leads to increased cost of production. The management should go into

the causes of absenteeism and attempt to reduce the absenteeism as far as possible. The

manpower planning experts will have to consider the known rate os absenteeism in

their decision regarding estimation of manpower requirements.

Work study: : work study technique can be used when it is possible to apply work

measurement to know how long operation should take and the amount of labour

required . this is also known as workload analysis . on the basis of the workload of

each plant during the forthcoming years , workforce analysis is done considering the

rate of absenteeism and labour turnover.

4.Supply forecasting

Along with demand forecasting ,it is equally important to forecast the supply of

different types of personnel with the organization at the cut off date of human

resources planning . There are two sources of supply of manpower internal and

external but the internal supply is more important for manpower planning. It comprises

of the employees working in the organization that can be promoted or transferred to fill

up various jobs as and when they fall vacant. This would required evaluation of the

present personnel abilities, their strength and weaknesses, so as to gauge their

suitability for different jobs. In order to estimate internal supply of the personnel, it isnecessary to conduct human resources audit and replacement charts in advance.

5. Estimating the Net Human Resources Requirements

The human resource planner must compare the demand forecast for human resources

with the projected internal supply of human resources before coming to any

conclusion. This exercise should be carried out department and skill wise to know the

deficiencies or surplus of various types of personnel in future. The possibilities of

transfer of personnel from one department to another and promotion of personnel to

higher jobs must in the organization as a whole.

6. Action plan for redeployment or redundancy

The management has to plan for redeployment or redundancy in case of surplus staff

position. If surplus is estimated in some jobs, employees are estimated. The

management should also plan for training or re-orientation before redeployment of

employees .redundancy plan has to be made if the surplus employees cant be

redeployed . it would include the types and number of employees to be retrenched or

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offer golden handshake under voluntary retirement scheme (VRS) type of help to be

extended to retrenched employees in the form of compensation, type of help in getting

new jobs outside the organization , priority to the retrenched personnel in filling future

vacancies and so on.

7. Determining job requirement of positions to be filled

Job analysis is the qualitative aspect of manpower planning since it determines the

demands of a job in terms of responsibilities and duties and then translates these

demands in terms of skills, qualities and other attributes. It helps in determining the

requirement of jobs and qualifications needed to fill these jobs .Thus, Job analysis is an

essential element of effective manpower planning.

8.Employment plan

This phase deals with planning how the organization can obtain the required number

and right type of personnel. In other words , there is a need to prepare programmes of

recruitment , selection , transfer and promotion so that personnel need of various

department of the organization are met timely

9.Training and development program

The preparation of human resources inventory helps in identifying the training and

development need of the organization. Training is necessary not only for new

employees , but also for the existing employees. All types of jobs usually require some

sort of training for their efficient performance. Even when the persons appointed have

job experiences, they must be given some training to renew their knowledge and skills

and to tell what they are expected to do. The talents of the employees are not fully

productive without a systematic programme of training and development

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Chapter-3

Quantitative Aspects of the Human Resources Planning

The Quantitative aspects of thehuman resources planning involves demand forecasting andsupply forecasting as discussed below:

Demand forecasting: It is the process of estimating the requirements of the different kinds of

personnel in the future. The basis of manpower forecast should be the annual budget and long

term corporate plan, translated into activity levels for each function and department. In

manufacturing company, the sales budget would be translated into a manufacturing plant

giving the number and types of products to be made in each period form this information, the

number of man-hours by skill categories to make the quota for each period would be

computed. In an insurance company, forecast of new business would to be processed by the

underwriting department. In a mail order company, forecast would be made of the number of

order that might have to be processed, assembled and dispatched.

There are three basic techniques of demand forecasting:

1. Managerial judgment

2. Work study techniques3. Statistical techniques

In many cases, a combination of methods, say managerial judgment and statistical techniques

might be more useful. A brief description of this method is given below.

1. Managerial judgment

The most typical method of forecast used in smaller companies, or those whose do not have

access to work study data, is managerial judgment. This simply requires manager to sit down

think about their future workloads and decide how many people they need. It might be done

on a bottom up basis with the line manager submitting proposal for approval by the top

management.

Alternatively , a top-down approach can in which company and department forecast are

prepared by the top management , possibly acting on the on advice from the personnel and

organization and methods (O&M) department these forecast are reviewed and agreed with the

department managers.

Perhaps the best way of using managerial judgment is to adopt both the bottom- up and top-

down approach. Guidelines for department manager should be prepared which indicatebroad company assumption about future activity levels which will affect their department.

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Targets are also set, whenever necessary. Armed with these guidelines, departmental manager

prepare their forecast to a laiddown format. They are encouraged to seek help at this stage

from personnel, O&M, or work study departments.

Meanwhile, the personnel department, prepares accompany manpower forecast .the two sets of

forecast are then reviewed by a manpower planning committee consisting of functional heads.

This committee reconciles with department managers any discrepancies between the two

forecast and submits the amended forecast to top management for approval .This is sometimes

called the right angle method

2. Work study technique or workload forecasting

Work study technique can be when it is possible to be work measurement to know how

long operation should take and the amount oflabour required. This is also known as work

analysis .On the basis of the work load of each plant during the forthcoming year,

workforces analysis is done considering the rates of absenteeism and labour turnover.

Workload analysis. In work load analysis , the manpower planning expect needs to

find out sales forecast ,work schedules and thus determine the manpower required per unit

of product . The sales forecasts are translated the manpower into work performance for the

various department of the enterprise. In a manufacturing enterprise, one shall first find out

the master schedules and then department schedules. The department workloads are

converted into man hours in terms of different skills required. Workloads analysis is used to

determine how many employees of various types are required to achieve total production

targets. Similarly, plans are made concerning the amount of work that all other department(marketing departing department, purchase department, etc) it is essential to determine the

work-load in some tangible units so that they may be translated into man-hours required per

unit. Paste can, of course, be utilized for translating work- loads into man-hours required. to

take an illustration, let us assume that the annual production budget of the company is

360000 units the standard man-hours required to complete a unit of the product are 2 hours

the past experiences reveals that a works on an average can contribute about 2000 hours

per year .

The workload may be calculated as under:

1. Annual production budget = 360000 units

2. Standard manpower required per unit =2 hrs.

3. Planned manpower for the year (a*b) =720000 hrs.

4. Annual contribution of a worker=2000 hrs

5. No. of worker required (c/d)=180

Thus, 360 worker are needed throughout the year to meet the production is influenced by

many other factors such as availability of input and power , breakdown of machinery ,

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strike , lockout etc. nonetheless , work load analysis is quite suitable for short- term

projection of manpower requirements . Longterm projection can be made with the help

of workforce analysis.

Workforces analysis. In the above illustration, we came to a conclusion that 360

workers are required to make 360000 units in a year .Assuming that all other factors are

favorable, these conclusions illusory because it is almost certain that all the 360worker will

not be available on all working days because of the two major problems (i) Absenteeism

and, (ii) Labour Turnover. Both these factor operate to reduce the number of worker

available. Therefore, it is essential to do work force analysis in the light of these major

problems which have been discussed later in the book. in other words, it is necessary to

keep a sufficient margin for absenteeism, labour turnover and idle time on the basis of past

experience .if it is essential to keep a margin of 20% of the manpower required as per

workload analysis, the company must ensure that it has at least 432 worker on its payrollto meet the annual production target.

3. Statistical Techniques

The earlier techniques provide only a rough approximation of the number of employees

required and are suitable only for short range demand forecasting .long range personnel

forecasting is more amenable to statistical and mathematical techniques. This has been

particularly true in recent years as new mathematical techniques

. Have been develop and high speed computer are used to rapidly analyze large amount of

personnel planning date. Some of the important statically tools for forecasting are discussed

as under:

Ratio and trend analysis. Under this method ,m the main emphasis is on the ratio

which are calculated for the past data relating to number of employees of each

category , of production level , sales level, activity level/ workload level , sales

level, activity level/ work load are estimated with an allowance for changes in the

organization, methods and jobs. Future ratios are also estimated when changes are

expected in the organization of human resources. Then future manpower requirement

is calculated on the basis of established ratios.

Economics models. To build an econometric model for manpower planning purpose,

it is necessary to analyze past statically data and to de scribe the relationships

between a numbers of variables in a mathematical formula. The variables affecting

manpower requirement may be identified under heading such as investment, sales or

the complexity of the product line. The formula could then be applied to forecast of

movement in these variables to produce a manpower forecast. This is a complex

process which suitable for large organization.

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Regression analysis. This technique is used to estimate the manpower requirement

of an organizations at a future point of time, based upon such factor as sales, output,

services rendered, etc. Regression analysis is used when depend and independent

variable are functionally related to each other. Electronic computer are used to solve

the regression equation and forecast the demand for personnel.

Bureks- smith model. Elmer H. Brueks and Robert D. Smith have developed a

mathematical model for personnel forecasting based on selected key variables that

affect the organization overall human resources needs. The basic of the model is:

En= (Lagg +G)1/x

Y

Where En is estimated level of personnel demand in n planning period (e.g. years)

Lagg is the overall turnover or aggregate level of current business activity in rupees.

G is the total growth in business activity anticipated through period n in terms of rupees.

X is the average productivity improvement anticipated from today through planning period n

(e.g. If X =1.08, it means an average productivity improvement of 8%)

Y is conversion figure relating todays overall activity to personnel required ( total level of

todays business activity by the current number of persons . it reflects the level of the business

activity per person ) .

Supply forecasting . Supply forecasting is concerned with the estimate of supply of

manpower given the analysis of current resources and future availability .Here the personnel

planner must consider both the external supply (employees available for higher position in the

organization s geographic work forces) and the internal supply (organization s current

employees) external supply of personnel is important two reasons. First, the normal

separation of employees through voluntary turnover, retirement, illness, death and discharge

may require that the organization look to employment agencies, colleges and universities and

other sources to replenish lost personnel. Second, organizational growth and diversification

require the use of external sources to obtain additional number and types of employees.

The internal supply of personnel is influenced by the following factors:

(a)Existing manpower resources;

(b)Potential losses to existing resources through labour wastage;

(c)Potential changes to existing resources through internal promotions;(d)Effect of changing condition of work and absenteeism;

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(e)Sources of supply from within the firm.

Based on the above information the following techniques may be used to anticipate the supply

of human resources:

1. Markov analysis: This method uses historical information on the movement ofpersonnel that the takes place during a typical plan period. Data are collected and

reviewed for a number of years in order to estimate the likelihood that persons in a

particular job will remain in the job or be transferred, promoted, demoted, terminated

or retired. These historical flows of personnel (through the organization are

represented by probabilities .The probabilities are arranged in a transition matrix and

future personnel flows are estimated on the basis of the matrix.

2. Simulation: Based on Markov analysis, the simulation technique considers alternative

flow which examined for effects on future manpower supplies. Alternative flowreflects the anticipated results of policy or programme change concerning voluntary

and involuntary turnover, retirement, promotion, etc.

3. Renewal analysis: This technique estimates future flows and supplies of the

manpower by calculating (i) vacancies created by the organization, and (ii) the results

of decision rules governing the filling of vacancies. Alternative model may assess the

effect of changes in changes in growth estimates, turnover, promotions, etc.

4. Goal Programming: It is an operational research technique under which the planner

tends to optimize goal. In this case, the goal to optimize is the desired staffing pattern

subject to set constraints concerning such factor as the upper limits on flows, the

percentage of new recruits permitted and total salary budget.

Human Resource Analysis

The human resources planner should classify employees by function or department, occupation .

Level of skill and status. The aim should be to identify resource centers consisting of broadly

homogeneous groups for which forecasts of supply need to be made. There is endless scope for

cross analysis in preparing manpower inventories.Some detailed analysis may be essential for example the review of current resources may need

to cut across organizational and occupational bou8ndaries to provide inventories of skills and

potential it may be important to know how many people the organization has with special skills

or abilities. For example, chemists, physicists. ; Mathematicians. economists or linguists from

the point view of management succession planning an d preparation of management

development programme. ;it may be equally important to know how many people with potential

for promotion exist and where they can be found.

An analysis of manpower by age helps to identify problems arising from a sudden rush

retirements , a block sin promotion prospects ,or a preponderance of older employees. Length of

service analysis may be even more important because it will provide evidence of survival rates ,

which are a necessary tool for use by planner in predicting future resources .

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The analysis of current resources should look at the existing ratios between different

categories of staff. Recent movement in these ratios should be studied to the problem guidance

on trends and to highlight areas where rapid changes may result in manpower supply problems.

Labour wastage

Labour wastage should be analyzed in order to forecast future losses and to identify thereasons for people leaving the organization. Plans can then be attached to the problem causing

unnecessary wastage and to replace uncontrollable losses. The manpower planner therefore has

to know how to measure wastage and analyze its causes.

Labour turnover index :

= number of leavers in a specified period (usually 1 year) * 100average number of employees during the same period

This method is in common use because it is easy to calculate and to understand .this formula

can be misleading also .the objection to the measurement of labour turnover in terms of the

figure may be inflated by the high turnover of a relatively small proportion of labour forces.Thus , a company employing 1000 people might have had an annual wastage Rte of 20%

meaning that 200 jobs had become vacant during the year .but this could have been spread

throughout the company, covering all occupation and as well as short service employees.

Alternatively , it could have been restricted to a small sector of the labour forcesonly twenty

jobs might have been affected although each of these had to be filled ten times during the year.

These are totally different situation , and unless they are appreciated ,inaccurate forecasts would

be taken to deal with the problems.

The labour wastage percentage is a suspect if the average number of employees upon which the

percentage is based on unrepresentative of recent trends because of considerable increases or

decreases during the period in the number employed.

Labour Stability IndexOne measure which is considered by many to be an improvement is the labour stability

index:

= number of employees with one years service or more *100number of employees one year ago

This index provides an indication of the tendency for longer service employees to remain with

the company and therefore , show the degree to which there is continuity of employment. But

this too can be misleading because the index will not reveal the vastly different situations that

exist in a company or department with one where the majority of employees are short service.

Length Of Service Analysis

The disadvantage of the labour stability index may be partly overcome if also gives the

index of labour turnover .it is still fairly crude because it only deals with those who leave. Amore refined analysis would compare for each service for each service category the numbers

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leaving with the number employed .if for example,the total numbers employed with less

than three months service was 80 ,the proportion of leavers in each category would be,

respectively ,50% and10%--much more revealing figures, especially if previous periods

could be analyzed to reveal adverse trends.

Survival Rate

Another method of analyzing labour turnover which is particularly useful for manpower

planner is the survival rate ,i.e the proportion of employees who are engaged within a certain

period and who remain with the firm after so many month or years of service. Thus, an

analysis of apprentices who have finished their time might show that after two year, ten of

the apprentices out of the twenty ex-apprentices were still with the company,a survival rate

of 50% .

This would tell the manpower planner that he has to allow for half the number of

recruits in any one year to be lost over the next five year, unless something can be done

about the factor causing wastage. Thus, to achieve a requirement of 50 trained staff in five

year time. 100 people would have to be engaged during this period.

Effect of Internal Promotion and Transfers

The supply forecast should indicate the number of vacancies that will have to be filled up to

meet the demand forecast .vacancies arise because people leave but they exist of senior

manager any produce a chain reaction of replacements. Transfer between department and

divisions may also have to be allowed for .in the organization ,persistent patterns of

promotion or transfer may develop and it may possible to predict the proportions of

employees in particular categories who are likely to be promoted or moved in the future by

starting with a forecast of the chain reaction factor . To give a broad indication of the

displacement that may occur, for example, where there are three level of management:

3rd

line management : 2 promotion =6 moves.

2nd

line management : 5 promotion =10 moves.

1st

line management : 26 promotion =25 moves.

Total Promotion/ Moves : 32 41

However, this is a very crude estimate and so succession planning has to be worked out

specifically by reference to known retirement, resignation, and transfer. Further, it is alsoimportant to determine the impact of factor such as changes in normal weekly hours of

work; overtime policies; the length and timing of holidays, retirement policy; the policy for

employing part-times; and shift system.

Succession planning

Succession planning is the process that is used by manpower planners to convert information

about current employees into decisions about future internal job placement that might be caused

by promotion ,transfer , resignation , retirement etc. since promotion and other placement

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decision are usually the responsibility of operating (line) managers , the personnel department

serves in a advisory role .owing to the complexities and time consuming nature of succession

plans , succession planning is usually limited to the key employees management and top

executive position and to those employee in middle management and top executive position

,and to those employees identified as having long term potential . By identifying successors to

key job and highpotential employees, an organization may ensure a steady flow of internaltalent to fill important vacancies, whenever they arise.

Succession planning encourages hiring from within and creating an environment in which

employees have careers, not merely jobs. Moreover, it identifies manpower shortages and skill

deficiencies before vacancies occur .through special assignments, job rotation and other forms

of development techniques, internal, candidates may be prepared to accept greater

responsibilities of future job opening. All this results in greater continuity of organizations

operation, better qualified incumbents and more unified corporate culture.

Sources of manpowerInternal sources of manpower supply will include the output from established training

schemes or management development programmes and the inventory of skills and potential

that exists within the organization .but the availability of manpower from outside the enterprise

is also a vital factor when preparing growth plans. Too often, corporate or functional plans may

be based on assumption about the availability of human resources of required caliber, locally or

nationally, which could easily be proved wrong after a brief investigation. it is particularly

necessary to identify at an early stage the job category where there might be difficulties in

recruiting the number required .this would help to prepare a recruitment campaign to tap

alternative sources, or to develop training or retraining programmers to convert availablemanpower to meet the company needs. The local factors which can have an important bearing

on the supply of manpower are listed below:

1. Population densities within reach of the company.

2. Current and future competition for labour from other employers.

3. Local unemployment level s.

4. The traditional pattern of employment, locally and the availability of people with the required

qualification and skills.

5. The output from the local educational system and government or other training institutes.

6. The pattern of immigration and emigration within the area.

7. The attractiveness of the area as a place to live.

8. The attractiveness of the company as a place to work in.

9. The availability of part time labour such as married women.

10. Local housing, shopping and transport facilities.

The Macro Level Factor Affecting The Supply Of Human Resources Are As Under:

1) Trends in the growth of the working population.

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2) National demand for special categories of manpowergraduates, professional staff,

technologists, technicians, craftsman, secretaries.

3) The output of the universities, polytechnics and professional institution...

4) The effect of changing educational patternschildren staying longer at schools or

different emphasis in university or school curricula.

5) The impact of government training schemes.

6) The impact of government employment regulations.

Chapter-4

Qualitative Aspect of Human Resources Planning

After determining the number of personnel for each department in the organization, it is

necessary to determine the precise nature of different job in terms of function, duties and

responsibilities. This would help determine the minimum acceptable qualities on the part of

personnel required for adequate performance of the job in question. This aspect referred to as

the qualitative aspect of manpower planning .the phenomenon of determining the nature of the

job together with the minimum acceptable qualities on the part of personnel required for

adequate performance of the job is termed as job analysis. To quote Edwin B.Flippo, -- job

analysis is the process of studying and collecting information relating to the operation and

responsibilities of specific job.

With the help of the facts and information obtained through job analysis ,two statement are

prepared : (i) job descriptionit contains details about the contents of a job; and

(ii) job specificationit reveals physical, educational, and other qualifications as well as the

experience required in an individual to perform the job satisfactorily.

A job description is an organized, factual statement of the duties and responsibilities of a

specific job .in brief, it should tell what is to be done ,how it is done and why. A job description

is a summary of the tasks, duties, and responsibilities of a job. Basically the job description

indicates what is done, why it is done, where it is done and briefly, how it is done. Performance

standards flow directly from a job description, telling what the job accomplishes and the

satisfactory performance accepted in each area of the job description .the logic here is veryclear. If the employees know what is expected and what good or poor performance is, then they

have a much better chance of performing better. Unfortunately performance standards, while

beneficial are often omitted firm most of the job descriptions.

A job specification is a statement of the minimum acceptable human qualities necessary to

perform a job properly .in contrast to the job description, it a standard of personnel and

designates the qualities required for acceptable performance. Thus, a job specification lists the

various qualification, skills, and experience an individual needs to do the job satisfactorily. The

job description describes the job; the job specification describes the person needed for the job.

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The major use of job specification is to guide in the recruiting and selecting of people to fill

jobs.

Difficulties In Human Resources Planning

Some of the problems being faced are described below:

1. Both trade unions and the officers' associations insist on the intake of personnel only at

the lowest level. There is a lot of resistance even if it is proved after proper scrutiny

that the organization needs to recruit personnel also in higher grades. Even though it is

found out that personnel in higher grades -are required to be recruited, there is a lot of

resistance. Such a situation is prevalent inmany public sector units. This 'disease' is

likely to spread to private sector too in near future.

2. Many a time, it is very difficult to transfer a person from one geographical region toanother. There is a general tendency to resist such transfers. It is reported that

European multinational companies have very well-thought-out programme of giving

intensive training and preparing their personnel for effective discharge of

responsibilities when they are transferred from one country to another. It is necessary

that something on those lines be thought of by associations of Indian companies. For

example, think of a man born, brought up, and educated in Kerala being posted in

Assam. He will feel as if he has come to an entirely new country. Solutions have to be

found out to these problems. This is necessary as complete regional balance in any

manpower system is neither possible nor desirable.

3. There is an imbalance in the growth prospects of people in different departments.

Solutions have to be found out especially by companies to keep a balance which

should avoid inter-departmental conflicts. A system of rotational assignments after an

intensive training could be employed so that this balance could be maintained.

4. Many companies find to their dismay that their executive turnover is growing at a

faster rate than their sales turnover. The older values are changing. Today a young

MBA from any prestigious institution is in a hurry to become Managing Director in the

shortest possible time. In addition to being overambitious, there are several other

reasons for the increase in executive turnover.

Some of these are:

I. Better prospects. It is a very vague term having different meanings for different

people-money designation, growth, overseas training, etc.

II. Leaving before being fired. With the increase in number of high pressure chief

executives, such resignations will increase in the years to come.

III. Foreign assignment. A significant. proportion of all those with specialized skills in

fields such as engineering, and information technology take up foreign assignments tomake a fortune. It is difficult to stop this tide.

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IV. Parity in promotion. Promotion policies of many companies, specially large ones,

contribute significantly to the executive turnover. A rational promotion policy is

needed to reduce turnover on this account.

V. Bad boss. A bad boss is like a pain in the neck. This inevitably leads to separations.

VI. A cohesive boss-subordinate relationship will certainly result in longer job retentions.

VII. Organizational climate. Some of the above factors contribute to what may be termed

loosely as organizational climate. As per a recent survey, highly confident managers

Chapter-5

Human resource utilization

Human resources or manpower utilization is concerned with the efficient use of the organizationexisting human resources required two things. Firstly people must be placed on jobson such a

way that they organist ion steal manpower resources are most effectively allocated secondly,

human resources utilization involves achieving optimum productivity from the work-force after

work has been allocated theses involves the complex of motivational factor affecting individual

,group and organization performance and is concerned with such areas as leadership and morale.

There are two methods for assessing human resource utilization. The first one is the manning

ratio which is based on the relationship between the number of people employed in the

organization and a specificities measure of productivity. The manning ratio will help in

identifying the extent of the manpower problem but will not help to identify the causes ofmisutilization or under- utilization. The second method is by use of work study. Be careful

observation and recording the work period. This will give answer to certain important questions

such as:

(a) What is the total number of employees?

(b) What is the quality of employees?

(c) What is the breakdown of males and females?

(d)what is the span of employees?

(e)What skills and abilities do they have?

(f) How long will it take to bring them up to the required standard and speed?(g) Who are suitable for future promotions?

As showen in figure.1, the study of manpower utilization will help to identify three crucial

factor namely, organization structure, job requirements a manpower required .each of will have

an effect on the individual or groups in the work unit.

The organization structure can be conditioned by the system of production. The job

requirements will be influenced by the type of technology used in order to make full use of

existing manpower, we have two factors to consider, namely:

(a)The competency of existing staff and their suitability for the new positions must be

analyzed.

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(b)Work satisfaction must be identified, otherwise there will be misutilization caused by

people in the wrong job, absenteeism and labour turnover. If the entire factor can be

brought together, we have a good chance of achieving full utilization of human

resources.

Human resource accounting

Concept Of Human Resource Accounting

Account in accounting for the human resources deals with the measurement of cots which are

associated with recruiting, selecting, training, placing and developing the employees of an

organization .this also involves measuring the present economic value of human resources to

an organization. Human resources accounting (HRA) may thus be reckoned as the

measurement and reporting of the cost and value of the people as organizational resources.

American accounting association has defined human resources accounting as a process of

identifying and measuring data about human resources and communicating this information to

the interest parties.

The basic objective underlying HRA is to facilitate the effective and efficient management of

human resources as it would provide the manager with the information needed to acquire

,develop, allocates, converse, utilize, evaluate and reward human resources .beside, HRA also

provide feedback to a manager of his own performance.

Human resources accounting is intended primarily to be used as a managerial tool. It also has

significant use for present and potential investors and other users of corporate financial

statements who would be interested to know the value of the firms human assets. It also

provides the organization with a more accurate accounting of its return on the total resources

employed.

Benefits of human resources accounting

In the field of management decisionmaking, HRA would help in making meaningful

choices between various types of investments in human resources and other assets. It would

assist the manager particularly with regard to:

(a) Direct recruitment vs. promotion

(b) Transfer vs. retention.

(c) Retrenchment or relieving vs. retention

(d) Utility of cost reduction programme in view of its possible impact on human relations.

(e) Impact of budgetary control on human relation and organizational behavior.

(f) New dimension added to capital budgeting process which includes human resources

investment costs.

(g) Consideration of an adequate return on investment in human assets and also a more

useful interpretation of return on capital employed.

(h) Decision on relocating factories, developing overseas subsidiaries, closing down orstreaming existing units.

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Methods of human resource valuation

There are four methods of ascertaining the value of human resources which are discussed

below:

1) Historical or actual cost method .In this, the amount actually spent to recruit, train,

familiarize and develop an employee is added and capitalized as the opening value of the

cost of the employee. It should be noted that in accordance with the general accounting

practice only those are capitalized. Those outlays, the value of which is not expected to

last beyond the current accounting period are treated as expense items.

2) The value of investment in the employee can be increased by further expenditure on

training, development and familiarization over the expected useful life of the investment.

In general, the outlays for acquiring and integrating new management employees are

authorized over the expected tenure of these employees in the company, while investments

for training and development are amortized over a much shorter time.

3) One strong point of this the fact the effects of human resource accounting can be shown on

conventional Performa balance sheet and profit and loss account since the information in

these statement is also stated on historical basis.

4) Multiplier method. This method is based on the belief that there is no real relationship

between costs incurred on an individual and his value to the organization at any particular

point of time (a weakness of the historical method). In fact, there are other factor like

motivation, dynamic attitude and working environment which will affect his value.

5) This method divides the employees into four categories: senior management, middle

management, supervisors, and clerical and operative employees it then collects salaries

and wages totals for each of these groups and applies appropriate multipliers to these totals

to get a total figure for the asset value of the employees. The most important element in

this method is the multiplier and it is necessary the most important element in this method

is the multiplier and it is necessary that its nature be well understood before the method is

applied. The multiplier is a means of relating the personal values of the employees to the

total assets of the organization. The factors which an employee multiplier factor attempts

to reflect are:

a. Qualifications and technical expertise ,

b. experience required for the job ,

c. personal qualities and the attitudes ,

d. promotion capability

e. replacement scarcity ,and

f. Loyalty and expectation of future service.

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6) It should be rather obvious that the highest multiplier would be attached to the senior

management grade while the low multiplier would be attached to the clerical and operative

grades .since the assets value calculated by this method depends on the multipliers, the

multipliers used must be checked for consistency with the total value of the business as a

whole. If the value of human exceeds or is less than the goodwill calculated it is obvious

that the multipliers used to calculate the value of the human assets are inaccurate and

require adjustment.

Replacement Cost Method. this method value the human assets as what it would cost to

replace the organization s existing human resources .this cost would include the cost of

recruiting ,training and familiarization as well as the opportunity cost from lost from revenue

during the period he period of training .

7) This method has the disadvantage of being inconsistent with the historical cost principle of

valuing assets. However, this problem could be solved if all the assets are valued at

replacement cost.

8) Economic value method. This method discounts to a present value that portion of the

companys future earnings directly attributable to the human resources of the firm. The

problem with this is a method is two-fold:

(a)The discount rate to be used cannot be calculated with a high degree of

objectivity; and

(b)How the company can apportion its earning to all the factor of production that

gave rise to these earning, e.g., patents, finance, capital goods, human

resources, etc.

IMPACT OF TECHNOLOGY ON HRP

In order to cope with the competition, organizations have to guarantee on:

(a) Producing goods and services more efficiently and economically

(b) Innovating product and processes so as to gain competitive advantages.

Advances in computer technology have off: Red organizations new opportunities to enhance

and streamline their processes. Computer-aided design (CAD), and computer aided

manufacturing (CAM) reduce human intervention and shrink the cycle time. An advance in

information technology has reduced efforts required in inputting; retrieval, processing, and

sharing of data. Timely and accurate information can easily be made available to different

levels of management for decision making. All these changes in technology result in a change

in occupational and skill profile of manpower. A fundamental revolution may be imminent in

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managerial decision making as managers increasingly make company decisions in front of

computer terminals.

Different manufacturing technologies have different skills required to design, operate, and

maintain the machines and equipment. Also the same technology can have a different impact

on different categories of workers and industries. The actual skill implications of technology

change will also depend on:

(a) Management's policy for development of manpower

(b) Attitudes and bargaining strength of the union

(c) Ability of manpower to adjust and adapt to the new technology.

According to ILO, introduction of new technology can affect other aspects of working life-

workers' responsibilities, skill requirements, job content, physical and mental workload, careerprospects and communication and social relationships at work.

Usually higher knowledge, skills and ability are required for operating and maintaining new

technology and participating in innovative processes. For skilled workers and office staff, the

manual content of skill tends to decrease but requirements for mathematical skills and ability

to plan, and anticipate future situations tend to increase. The methods, systems and style of

management also need changes in line with high skill demands on personnel. A more

democratic and decentralized management style is necessary to motivate highly educated

employees.

The present education system of our country is inadequate to match the technological needs.

The syllabus is outdated, teachers are not fully competent, and there is a lack of infrastructural

facilities. Companies will, therefore, have to add these skills through training at appropriate

intervals. This could be done with the help of in-house faculty or hiring the services of outside

institutions. Manpower planners should therefore keep in mind this requirement and also the

requirement of retraining. There may also be a need for rationalization of the trade structure

because of multi-skilling. For example, traditional and relatively narrowly conceived metal

trades which date back to 1930s have been replaced by six broadly defined occupations.

Lathe, milling, grinding could be clubbed as cutting mechanics. Production engineering,

machine and systems engineering, precision engineering, and light engineering could be put as

industrial mechanics. In office context, we now require persons who are computer trained and

also operate other office equipment such as fax, and Xeroxing machines. This will also require

restructuring of training for employees.

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Changes in work and work design result in, certain jobs becoming redundant and a need for

others to be created. Some personnel may also become redundant. Indian Labour Conference

(1960) resolved that there shall be no retrenchment on account of technological change

.

Chapter-6

CASE STUDY -1

Hierarchy of workforces

`

AMBATTUR CLOTHING LIMITED

Corporate Factory

Managing directorManaging director

Vice- presidentVicepresident

Factory ManagerDeputy G. Manager

General Manager

General Manager

Sr. ManagerProduction Manager

ManagerSupervisor

Ass. Manager

Executive

Jr.Supervisor

Operators

Sr. Operators

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History

Ambattur clothing limited was started in the year 1981. It has come a long way in the past 21

years. Currently it has around 8,000 employees spread across 14 factories. All the 14 factories

are situated within a radius of two kilometers. It is situated in the heart of the Ambattur

industrial estate. At least 500 workers are employed in each if these factories. Ambattur

clothing limiteds core business is garment exports. This exports their garment to American

and other European countries which has wide acceptance for their products. Out of the total

garments produced 90% is exported and the remaining 10% is used for domestic purposes

under the brand name color plus.

Objective of the H.R Dept of Ambattur clothing limited

Recognition.

Efficiency.

Commitment to the core competitors.

Operations and nature of the employee tenure

Business plans are made at the end of each year. The entire department draws structure by

October or November. Vacancy level in terms of staff if there is an expansion of the company

or when a new company is launched the recruitment procedure starts. For promotion the

existing staffs are given preference.

Recruitment policy

In the year 1995, Ambattur clothing limited with the collaboration of KSA techno pack from

United State of America came out with a hallmark human resource policy after 14 year of

existence. Under this study, both Ambattur Clothing Limited and KSA techno pack came to a

conclusion based on their study that each machine is allotted with 1.5 workers as the ratio

(1:1.5). According to the new plan, the ideal number of workers per factory including

absenteeism will come up to 750 people.

AssistantsHelpers

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Selection

Any vacancy in terms of level transfers or promotions, inside the Ambattur clothing limited

existing employees are given first preferences .if there is a competition for a particular post

between the existing employees seniority is given preference.

Ambattur clothing limited follows 3 main of recruiting people:

Data bank

Tie up with websites

Man power recruitment channel

They do not believe in the concept of advertising for job vacancies in the media of kind (print,

television, hoarding, signboards, etc.) To them the last option is advertising.

Job profile formThe job problem form is being filled up by the candidates who apply for the job at all the

levels and the form is being sent to the HR dept of Ambattur Clothing Limited. Mr. Suresh, a

junior executive had completed his bachelors degree and his post graduation while working

for the company. Thus Ambattur Clothing Limited helps not only the worker but also the

corporate side of the employees.

They even sponsor them with educational loans for self up gradation of the employees. This

kind of financial and moral support encourages the employees and helps them to perform

better. When a question of signing bonds between the employer and employee arises,

Ambattur Clothing Limited does no inclination towards that policy. In contrast to contrasts

does not have any binding in signing bonds with the worker as it reduces the number of

applicants (some of whom may not wish is sign bonds).

Incentives

In Ambattur Clothing Limited, they have a unique way of rewarding their work which is away

from conventional methods. They have categorized this into two areas:

Monetary reward

Nonmonetary reward

Monetary reward

The monetary rewards are provided to the employees according to their performance .to

makes it plain, it means increase in productivity, efficiency and cost effectiveness. Under the

monetary rewards, there are performances wages, compliment every year. All the cater visor

selected on the basis of productivity under his supervision, gets a compliment every year. All

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the categories in the hierarchy of work force will be reward at different level of compliments.

Right now at this point of time a brand new car is being awarded for the best performer (post

being the senior supervisor)

Non-monetary reward

In the non- monetary rewards all the worker of the company are taken out for a one day trip to

some recreational spot such as zoo, amusement park, museum etc. the employees and their

families are provided with accommodation , food , beverages during their trip. The essential

idea under this incentive plan is for the encouragement and betterment of employeremployee

relationship. Ambattur clothing limited provides subsidized lunch for the employees. Down at

the canteen everybody is treated equally irrespective of their rank or position in the company.

To foster this policy, Ambattur Clothing Limited has built a massive single all its employees.

There is no special seating arrangement armament or difference ion quality of food or service

rendered to them. The helper and the managing director are given the same food and they are

seated next to each other. The managing directors are not provided with separate table or chair

as everybody is treated equally.

The wage of the employee differ according to the performance of the. If there is an employee

who is more efficient than the other employee of same category or level of work, then the one

who is more efficient is paid more. Ambattur clothing limited follows certain conversion rate

which is being followed according to the performance of the employees. This individuals

performance is categorized into 4 benchmarks:

Excellent

Good

Average

Satisfactory.

If the performance is excellent then the conversion rate is 20% of gross salary. For good it is

15%, average it is 10% and for satisfactory there is no increment. Along with these they are

also are linked to the business profits. If the profit of the company is more the percentage of

tall the incentives increases. It differs according to the business profits.

Quality of work life

For example in general electrical a worker addresses the M.D by his name outside the factory

or in the canteen. The same way is followed in Ambattur clothing limited too. Coming to

healthy benefits there is a hospital run by Ambattur Clothing Limited. This hospital is

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specially run for non surgical cases. There are even medical practitioners from within the

company in the case of an emergency the worker are taken to the hospital and given free

medical service this program is followed for a pretty long time for employees benefit and also

the commitment which are being provided. The employee reciprocates for the facilities which

are being provided. The employees are also provided with crche facilities for their children so

as to help or reduce the mental efforts of the workers.

Competitors

Ambattur clothing limited considers china as their major competitor. Apart from china, they

face a similar competition from Indonesia and Philippines. . To avoid or rather maintain a

healthy competition Ambattur Clothing Limited maintains a high quality proportionate to

prices for their apparels. Recently textile major Raymond has on September 2002 clenched a

deal with Ambattur Clothing Limited to acquired 75% staked in the Chennai based color plus,

a flagship subsidiary of the latter for 35 crores. With that Ambattur Clothing Limited has

diversified its operation to gain major hold in the apparel segment.

Strengths

The major strength Ambattur Clothing Limited is its quality and commitment. The apparels

produced by the 14 factories undergo severe screening and tests to maintain. Almost quality

and goodwill of the customers. On an average the garments exporting companies in India

supply goods on time only 60% of the times. Ambattur Clothing Limited maintains a good

position for its commitment in the delivery of products. Only in Ambattur Clothing Limited

95% commitments is fulfilled the 5% is delayed due to various reasons.

Ambattur Clothing Limited gives all the credit to its worker handwork and loyalty for the

maintenance of its commitments. The labourers are very much loyal to the management and

staff. The determination and industriousness shown by them helps to increase the productivity

. The fortunate and unique thing about the labourers of Ambattur Clothing Limited is that they

do not have a workers union . Unlike their counter parts in order industries Ambattur

Clothing Limited employees believe and trust their management for their quality of work life.

This it assures the public of Ambattur Clothing Limited excellent track record in the human

resource planning and development.

Weakness

According to Ambattur Clothing Limited, they consider the size of their company as their

weakness because of the time taken in planning and training programs which has to reach each

and every employee. Since the company has grown at a sizable level it takes at least two years

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for them to reach the last worker for the training. Presently there are around 8000 worker

totally. Under their training method they have a minimum of 3 days as the training period /

year. For example on an average if they work for 240 days per year. Out of the total 240 days

3 days is compulsorily allotted out for training. Out of these 3 days one daft is allotted for

behavioral training and the other two days for technical training.

Future plans

They are concentrating more on the suitable workplace.

For the employee, they are planning to bring in workmen development activities

The concentrate more on the family member development of the employees.

The plans and ideas for the community development of the worker and their families is

being concentrated more and given importance.

Chapter-7

CASE STUDY 2

HR Planning at the City Hotel

The City Hotel is located in the middle of a medium-sized city. It caters mainly for business

trade during the week and for holiday trade during the weekends and in the summer. In the

summer and at weekends there is, therefore, a greater demand for catering and waiting staff as

there is a greater demand for lunches. During the same periods there is a lesser demand for

housekeeping staff as the customers are mostly longer-stay. The