A managerial perspective on human resource planning

Transcription

1 A managerial perspective on human resource planning Christopher Orpen The business environment is changing in a way that requires managers to engage in significantly more human resource planning. Human resource planning can lead to improvements in productivity when it is supported by efforts to clarify job roles, to provide training and development for workers, and to engage in comprehensive performance appraisals. The paper develops guidelines for making human resource planning more effective. Christopher Orpen is professor of management at Deakin University, Australia.

2 Managers in most countries are showing a greater concern for human resource planning and are increasingly doing what is necessary to have their plans put into effect. Surveys have shown that this is not only occurring in the western industrialized countries, but also in third world countries in Africa and Asia (2). Whereas it was the multinational companies that initially took the lead in this important aspect of personnel management, more and more local companies are finding it necessary to engage in syndicate planning in respect of human resources. To a greater extent than previously, managers are concerned with such basic human resource problems as planning and control of staffing requirements, development and succession of talent for senior positions, improving the match between individual capabilities and performances and the rewards and requirements of their jobs, and improving the performance of employees in their jobs. These are obviously not new concerns, but in the 1980s we see a much greater urgency in the way managers are tackling them. In this short article, the context of this heightened concern will be briefly sketched. Then, a number of new approaches of particular relevance to African conditions will be discussed for each of these basic problems. Changing business environment There are a number of reasons why the present day managers are today more concerned with these issues than previously. Many of these reasons stem from external factors over which individual firms, especially in third world countries, have relatively little capacity to alter to fit themselves. One important reason why managers in Africa and elsewhere are more interested in human resource questions than previously is that so many countries, following the lead of the United States, have enacted equal employment and affirmative action legislation. And even when the local country has not done so, foreign multinationals operating in the country have typically felt themselves obliged to fall in line with legislative procedures in their home country, usually the United States or Europe. The most direct consequence of this expansion in government intervention has been an increase in the attention given by managers to human resource planning in each of these problem areas. Without such attention, there is the real danger that firms will run foul of government decrees. This has at least three serious effects. It can lead to heavy fines and other penalties incurring the closing down of some facilities. In addition, a failure to abide by government legislation will certainly lead to closer inspection and tighter surveillance of the firm's activities, which is seldom to its advantage. Finally, the firm will probably lose government contracts, which can be very serious, especially in small third world countries in Africa and Asia. The consequence of the greater attention given to human resource planning is that more national career systems have been introduced in many companies, with explicit promotional paths and detailed job requirements. In addition, in most firms, more objective procedures are being employed to match individuals with their jobs, especially in selection. Instead of being left to chance, firms are increasingly planning ahead so that their manpower requirements are properly met. 18 Vikalpa

3 Far more systematic procedures are being employed than previously in recruitment, selection, and placement (4). Finally, career development and training programmes are being expanded so that gaps created by resignations and promotions can be filled effectively, without going outside the firm on each occasion. Another reason for the greater concern with human resource planning is the fact that business profits are being squeezed by inflation and slower growth in most countries, making it necessary for managers to achieve increased output with the same or fewer staff. Two broad strategies have typically been adopted to bring about greater productivity of this kind. First, human resources are being more thoroughly and effectively controlled, through more detailed job analysis, stricter staff ceilings, more explicit career paths, and more systematic schedules of terminations and resignations. Second, positive attempts are being made to improve productivity by means of better selection, more thorough recruiting, and more widespread and intensive training and developmental activities. A third factor which is responsible for managers giving more attention to human resource planning is the unpredictable nature of the business environment. The context within which firms have to operate is more dynamic and capricious today than it was 10, and especially, 20 years ago. Nowhere is this more apparent than in Africa, where political instability has often been accompanied by violent fluctuations in commodity prices and sudden changes in investment policy on the part of the industrialized countries. The most effective and perhaps only way for firms to insulate themselves against the worst effects of this unpredictability is through careful and thorough forecasting and planning. If they are to survive and prosper, firms must look ahead and try to predict what is likely to happen. They should then take spcific steps to manage their employees in the mariner, suggested by these predictions. In effect, this means that firms should engage in human resource planning as a "defence." A fourth important factor, especially in Africa, that results in more human resource planning is a short supply of competent talent and a need to obtain a return on investment in the recruitment and development of talent. Both of these factors encourage emphasis on the retention of employees rather than on recruitment and selection. As a result we find an increasing concern among firms in Africa and elsewhere on things like career development individual counselling, job redesign, and fringe benefits. The aim is to keep good employees sufficiently satisfied so that they would want to stay with the firm, rather than join a rival firm. Planning for staffing requirements According to the statistics, most business failures are caused by poor management and inadequate or careless planning. A properly researched business plan will stimulate the next several years of operation and thereby will identify potential pitfalls. Though not all problems can be foreseen, the company that can anticipate them can prepare for and possibly help mould the future through systematic Vol. 10, No. 1, Jan.-March,

4 forethought and planning. Such an approach is clearly better than one of waiting for crises to arise which then consume management's time and divert attention from normal operations. The owners and managers also need to share joint objectives and goals in both qualitative and quantitative terms and to understand the basic approach for achieving these targeted goals. This is addressed by the preparation of a strategy programme and operational plans linked to a time-frame corresponding to the stated objectives. It is only through proper planning along these lines that firms can produce accurate estimates of future supply and demand of employees in specified categories, something that has to be done if firms are to prosper in the turbulent environment in Africa and elsewhere. Increasingly to improve the accuracy of staffing plans, firms are providing computer-generated lists of personnel complement, attrition, movement, and projected staffing requirements. Actual activities performed provide a basis for planning improved staffing, organization, and work assignment. The management planning process itself may be strengthened by the use of this more specific format for considering human resource requirements (1). Improving productivity The need to improve productivity ultimately requires that the performance of the various individuals who comprise the labour force is stepped up; that individuals work harder and more effectively. In this respect, one of the main reasons why productivity is often quite low especially in third world countries is that individuals are not properly matched with their jobs, and hence their performance is impaired. In most cases, however, individuals could be more productive if standards and objectives were established, and skill and knowledge requirements were more clearly defined. For many years, managers have relied on trait-oriented employee appraisals as the basic tool of managing performance, which are often too general and unrelated to the work. In addition, there has been an unfortunate tendency to rely on job descriptions that are frequently outdated before they have been fully written up and frequently do not describe the work actually performed on the job. To overcome these problems, firms should concentrate on results rather than actual tasks and duties completed in appraising performance. Because of the difficulties in evaluating performance in terms of what is achieved, a manager should: 1) Provide assistance to supervisors in performance planning and counselling; 2) Allow individuals to participate in both the planning of the work and the review of accomplishments; 3) Clarify job requirements and performance expectations; 4) Provide training to employees to bridge gaps in skills or knowledge; and 5) Provide incentive to individuals through merit pay that reflects actual performance. Improving management development In order to improve the capacities of managers to contribute to the realization of company goals, it is necessary to have a clear idea of company objectives 20 Vikalpa

5 over a future time period. This can only be achieved by planning ahead and by spending time and money to develop a comprehensive plan for the company. A company plan is developed only through very careful planning of future desired objectives and intended action programmes and exploration of the means for assuring that the desired achievements are accomplished. The only costs incurred by the company in the planning phase are that of time and some relatively minor out-of-pocket expenses. Time spent in proper planning before a venture is undertaken will typically earn very substantial returns. To be successful, planning must not be either inadequate or excessive, but must be kept in balance with other investments and have a clearly defined purpose. It must be based on appropriate assumptions and valid information, specific overall company objectives, goals and strategies, and reflect an appropriate level of risk taking. Long-range planning should be complemented by planning to improve current efficiency and regular reviews to monitor progress, thereby allowing for steady improvements in performance (3). One of the more important aspects that must be dealt with by the company plan is the question of continuity of management, especially whether there are competent persons to take over if key persons leave the firm suddenly. This problem has traditionally been dealt with by a so-called 'back up' chart which identifies successors for each key position. The charts present appraisal, age, length of service, and other data on the incumbent and one or more back up candidates for each position. Unfortunately there are a number of difficulties with this approach. For instance, there is rarely any contribution from the individuals themselves regarding their own self-assessments and career interests. In addition, the process tends to be a static, annual, paperwork exercise, and hence seldom results in new job assignments or training experiences for the 'support* candidates. Finally, it often happens that the nomination of support staff is based on the subjective judgement of the nominating manager without any objective indications of performance. In order to overcome these difficulties, companies must replace the simple charting method with a dynamic system that involves regular review meetings between managers and potential support staff staff who are identified as capable of taking over after the departure of persons in key postions. At those meetings there must be frank discussions of job requirements and the dynamics of positions in relation to changing organization needs, candidate information, and specific assignment decisions. The concentration on substantial data regarding job requirements, staffing needs, and individual development plans promotes management involvement and should improve decision making, especially over the long term (5). Fitting individuals for jobs Every company has only limited resources just enough capital, time and talent, and certain objectives (for example, a desire to increase total sales by a certain percentage). Coupling the company's objectives with its resources to ensure that the objectives are achieved is a difficult task. The purpose of the Vol. 10, No. 1, Jan.-March,

6 human resource plan is to help in accomplishing this task. By first formulating a thoughtful, carefully prepared plan for achieving the objectives of the company, management can utilize its human resources more efficiently and effectively. When properly executed, the human resource plan is a realistic statement of the company's objectives and goals, set within a description of the principal individuals and the milieu in which they will function, along with an overall approach and a detailed description of the steps necessary to achieve the objectives and goals. It attempts to replace "seat of the pants" management with the penetrating insight of reasoned logic and demonstrated analysis. One of the most important goals of the human resource planning is to improve the congruence between individuals and their jobs. As a result, there has been increased emphasis in recent years upon improving assessments of individual skills, knowledge, aptitudes, and interests. Because of increased employee interest in career development, managers today are concerned with job assignment and career progression. As a result, organizations are adopting more formal and more objective systems for appraising individual capabilities and potential and guiding individual development. In addition, positions with similar requirements are being clustered as job families, and paths among these families specified to make individual appraisals, career counselling, and training more job related. Through analysis of actual job behaviours and related qualifications requirements, career progression possibilities are also being made more explicit. Finally, various individual characteristics such as sex, age, and race are being increasingly evaluated as to their job relatedness, as an essential step towards removing discriminatory employment practices, and to improve the assessment of the employee's potential performance on other jobs. Human resource planning In summary, practices in human resource planning must change to be responsive to the needs of today, in order to improve the effectiveness of organizations. The present article has spelt out some of the ways in which planning exists, and how it must alter in order to bring desired results. Underlying the specific points must be the realization that it is planning ahead which is vital for firms to survive and prosper. References 1. Acquiller, F.J. Scanning the business environment. New York: Macmillan, Campbell, D.T. The world economy. London University Press, Mills E.T. Human resources Why the new concern. Harvard Business Review, 18, 1975, Orpen, C. Current trends in personnel management. Melbourne: Academic Press, Walton, E. The diffusion of new work structures: Explaining why success didn't take. Organi zational Dynamics, 10,1975, Vikalpa