In the days when the business world was somewhere between Don Draper and Gordon Gekko, what we now call human resource planning was known as manpower planning. Now that about 47 percent of U.S. workers are women, as per 2017 data from the U.S. Department of Labor, the nomenclature has changed, but the basic definitions and processes remain the same.
For the most part, human resource planning (or HRP) is exactly what it sounds like – it's the process of assessing the ins and outs of how to move from your current human resource situation to your desired HR situation. Of course, it's not quite as simple as all that, with a few different types, or levels of HRP to dive in to, as well as wrinkles such as HRP forecasting to explore.
On the front end, human resource planning helps businesses recruit the necessary staff. One succinct definition states that it is "... a process by which an organization ensures it has the right number of people, [and the] right kind of people, at the right place at the right time," offered by Subhash Chandra Pandey of Kalicharan P.G. College. It also helps ensure that these people are in positions that take the greatest advantage of their individual skill sets, which may be explored during thorough onboarding and training.
Comprehensive HRP determines a company's human resource requirements, the means for carrying out those requirements and a detailed plan for optimizing results, as well as a framework for how to implement the plan. It details the acquisition of staff, the utilization of people power and the means for the preservation and improvement of a company's resources.
Getting down to the nitty-gritty, the HRP process often includes defining objectives, determining HR needs and detailing your inventory, then adjusting the demand and supply of human resources based on those factors in order to create an optimal work environment. Strong HRP can help your company recruit and train while learning to better allocate staff, wages and salary costs.
Commonly, HRP is broken down into two main types: hard human resource planning and soft human resource planning.
While both schools of thought largely focus on the same overall results – putting the right people in the right positions in order to minimize input and maximize output – hard HRP revolves around quantitative analysis to achieve these means. When approaching your HR assessment with hard HRP, you'll focus on concrete factors such as staff availability, links between hiring, firing and budgeting, and cold appraisals based on concrete analysis of past performance. This type of HRP is results-focused and, speaking generally, tends to view staff as a statistical resource, making it a strong tool for short-term performance goals.
Compared to hard human resource planning, soft HRP really earns its name. This gentler approach puts the focus squarely on the "human" part of human resources, highlighting employees as your company's single most important resource.
As such, soft HRP often concentrates on employee needs such as motivation, rewards and communication. This school of thought empowers employees, encourages them to delegate responsibility and emphasizes democratic-style leadership, making it more appropriate for long-term strategy planning. The heart of soft HRP is all about developing and sustaining company culture and values.
At its core, HRP is all about foreseeing your human resource requirements, which is why you're bound to hear about the types of HRP forecasting – or the types of manpower forecasting, if you're old school – sooner than later.
Demand forecasting is the act of planning your company's people-power needs, or knowing the number of people you require and the skills and competencies each one of those people holds. Demand forecasting plans are usually based on hard factors such as your annual budget and long-term business goals.
Taking a broader view, supply forecasting gauges the number of people available within and outside of the organization, focusing very much on planning for the "what ifs?" of business life. Supply forecasting analyzes your existing HR makeup but attempts to foresee and adapt to changes based on absenteeism, internal promotions, layoffs and employee shortages or surpluses.