Often, the work human resource departments do goes unnoticed because it occurs behind the scenes, yet this does not mean that it is unimportant. Human resource activities are critical to business success in a number of areas, including planning. Human resource planning ensures that a company will always have a pipeline of talented candidates ready to take on crucial job openings. Without human resource planning, a business would be hard pressed to fill its positions with well matched, skilled workers.
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In "Human Resource Management," R. Wayne Mondy describes human resource planning as the method of matching the supply of candidates, both internal and external, with new positions or openings that a company thinks it will likely have in the future. This means human resources should always have a pulse on the job market and how it relates to a company's hiring needs. An organisation cannot hope to meet its goals without recruiting talented workers.
In order to match candidates with future job postings, human resources must use forecasting. Requirements forecasting is determining how many future workers with what skills and abilities a company will likely need over a given period of time. Availability forecasting is estimating how likely a company is to be able to hire all of the employees that it needs.
In order for an organisation to succeed, it must be proactive in recruiting and retaining employees. Human resources planning is key in this sense, because it tells a company what course of action to take. If forecasting shows that the supply of potential candidates is roughly equal with demand, then a company does not have to do anything at all. However, if human resource planning shows there will be a tight supply of talent, then companies must increase their recruiting efforts and act quickly to secure employees. By contrast, if there will be a glut of workers, a company may want to institute layoffs or early retirements.
Connection to Organizational Success
Human resource planning is crucial to organizational success because it ensures that a company will always have a concept of the job market and how it relates to its future. A company that does not engage in human resource planning may find itself with a number of positions it cannot fill, because it did not anticipate a pick-up in hiring by a rival, or a drop in the number of college graduates schooled in certain fields. Not being able to hire the right people can cripple a company's ability to innovate and reach its organizational goals.
An Ongoing Process
Human resource planning needs to be ongoing if it is going to help an organisation reach its goals. For example, during a recession with high unemployment, a company may think it does not need human resource planning because it assumes that there will be plenty of applicants to every posting. However, some jobs are still in demand during a downturn, so securing people with highly desirable skills will always be a challenge.
In addition, a company's situation can change rapidly. If a number of people retire around the same time, it may have more openings more quickly than anticipated, which will require new forecasting and potential action.
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