Human Resource Planning (HRP): Definition, Process, and Challenges

Human resource planning (HRP) is the strategic process of hiring the right candidate for the right role at the right time to maximize human resources in an organization. It involves planning for candidate search, staff retention, training, skill analysis, etc.
 

The main objectives of the HRP include,
 

• Determining the total number of employees to be employed.
• Evaluate the current workforce to retain the highly skilled staff.
• Adopt efficient change management to manage an adequate downsizing program (reduce work hours and salary or lay off underperforming staff).

Organizations need human resource planning because it helps to forecast organizational demands, improve staff retention and engagement, adapt to changes, and point out skill gaps.

Good HR planning improves staff engagement and retention. Creating opportunities for staff training, skill-enhancing, and career-advancing will likely increase staff engagement and retention. Also, it helps to create a positive working environment within an organization, further increasing the employees' loyalty and reducing staff turnover.

Human resource planning also helps in predicting forthcoming workforce demands within the company. To do so, it needs to evaluate current and upcoming market tendencies, company projections, and growth plans. For instance, if a company wants to expand its operations, it needs to estimate the additional staff needed to sustain this growth.

Human resource planning is needed for companies to adjust to changing market trends. There is no assurity that markets have the same continuous trends, as there can be sudden market crashes, employees leaving organizations, employment of new laws, etc. Hence, HR planning leads to adjusting with all those changes.

HRP is needed to identify skill gaps within an organization. By evaluating the current workforce and future needs, organizations can point out the skills needed in employees for growth and those lacking talents. This makes it easy for companies to provide development training and programs to help the workforce meet their objectives.

Applying the appropriate HR planning ensures prolonged business continuity. Employing the necessary types of HRP strategies like contingency plans (taking action in unexpected events), succession plans (choosing new leaders when needed), and scenario plans (imagining different scenarios to make plans) helps to minimize losses in unexpected events and match the workforce and resources for business continuity.

From analyzing your organizational plans to identifying human resources gaps and taking action to fill those gaps, there are usually five steps in the HR planning process.
 

The first step in the human resource planning process is analyzing the organizational plans. Plan your current tasks and projects to be pursued, including company extension plans, accordingly.

Based on step 1, forecast the required human resources. It means identifying the workforce required to meet your requirements.

Given the estimated required human resources, look at the supply of employees and to what extent they are available.

Now, identify the difference between the organisation's required and existing human resources. Doing so gives you an idea of how many staff you require to hire or give training to existing staff.

Once you understand the staffing gaps, the proper actions are taken to fill those gaps. Here, actions mean hiring, layoffs, and providing training to the staff.
 

Note: It is necessary to monitor and control the entire HRP process.

The main types of human resource planning are using a “strategic approach” to meet the workforce for the company’s long-term goal and implementing “operational HRP” to manage the current needs.
 

Here are some different HR planning approaches to manage your workforce to achieve your company's dreams.

In the strategic HRP, we focus on the company’s long-term goals and try to align the workforce with them. This planning includes evaluating future needs, organizational growth planning, and necessary plans to tackle future changes in the industry or market.
 

Human resources strategic plan example: if you have a tech company and plan to expand your production line over the next ten years, strategic human resource planning involves hiring more software developers and training your existing employees.

Operational HR planning includes addressing the day-to-day management. It ensures that staff meet current needs. Operational HRP is a kind of short-term planning that ensures business operations continue smoothly daily.
 

Some of the activities in this plan include “filling in the immediate vacancies” and “managing the temporary increase in workload.”

Identifying and developing future leaders within the company is a key element in succession HRP. It ensures that there is a clear candidate to replace the key positions when they become vacant to minimize disruptions in the company.
 

A common example of this human resource planning is when a CEO retires; the organization identifies a senior manager who can step into the CEO’s role. Companies like IBM and Apple have famously used the succession HRP, ensuring smooth transitions in leadership.

Contingency HRP focuses on planning to take necessary steps during unexpected events to overcome disruptions in normal business operations.They may include sudden loss of key staff, natural disasters, or sudden market crashes.
 

For example, during the COVID pandemic, many businesses had to shift to remote work quickly. Companies with contingency plans already had plans and strategies to support their employees, especially in the IT industry, for remote work and flexible working hours. This helped them maintain operations despite the crisis.

Workforce HR planning focuses on analyzing the current staff and forecasting future needs. It can be based on company expansion, turnover, and retirement. This type of HRP includes evaluating both the quality and quantity of employees needed for meeting organizational growth.
 

For example, if the company notices employees retiring in the next two years due to old age, it can start recruiting employees and upskilling the existing staff. This helps to avoid a shortage of experienced human resources when older employees retire, ensuring business continuity.

Implementing a good HR planning can be a hassle as businesses can face some problems like, balancing work models, retaining staff, compiling with the law, and attracting top candidates.

Balancing onsite, remote, and hybrid workspaces is a human resource planning challenge due to different employee preferences while maintaining consistency, productivity, and team collaboration.
 

The company requires technology and team dynamics to balance all those work requirements, including the perfect HRP strategies.

Staff unsatisfied with their current jobs and leaving to join another company are unpleasant for employers. Even if an employer wants to replace those openings with talented candidates, it becomes costlier to fill these gaps, sometimes costing the 2X to 3X salary of the previous employee.
 

Also, even if new talent is hired, it can negatively impact the company’s culture due to a lack of institutional knowledge, which becomes a challenge in HRP.

With frequently changing rules and regulations, it is an HRP challenge for companies to always comply with the law. Organizations must constantly go through national and international laws included in the government rules.
 

If the company is non-compliant, severe penalties or any form of punishment are the conditions they have to worry about all the time.

Training and developing new skills for employees becomes challenging due to the wide use of remote and onsite workplaces. Especially in circumstances when it is needed to train a large number of teams virtually and physically simultaneously, there is a chance of candidates missing out or mismanaged. 

In today’s competitive business market, acquiring the right talent is a top priority in HRP. However, this has become a concern due to growing demand and a shortage of talented candidates. Hence, companies have to search for experienced employees constantly.

Implementing a good HR strategy can be troublesome with the challenges mentioned above. To make necessary human resource planning, you need to note a few points, like providing continuous training and development, using smart strategies, and using AI technologies for hiring. It makes the process straightforward.
 

• Provide regular skill development training to the workers for motivation and better performance.
• Provide feedback and rewards to the employees regarding their hard work. This keeps them from resigning from your office.
• Recruit new candidates by availing the services of online job-providing websites, social media, and referrals from your working employees. This helps you in saving time and money as well.
• For the attraction of potential candidates, offer competitive salaries and benefits to those candidates, like retirement plans and insurance.
• Give flexible working hours to the staff to manage their personal and work life, which will increase job satisfaction and retain employees.
• Try hiring people with different backgrounds to ensure everyone is respected and make the team more effective and creative.
• Managers should be strong and supportive, too. This is a must for good leadership, building trust, and maintaining motivation among the staff.
• Keep updated with employment law developments to avoid the legal complications that may affect the fair treatment of your employees.

Good human resource planning is complicated but significant in terms of business success. With the proper HR strategy, you can ensure that the operations run smoothly and will help your company achieve its goal. Build a robust work environment to align with the company's short-term or long-term goals by implementing the proper HRP process accordingly.
 

Also, strategic hiring, knowing challenges, and implementing effective steps to overcome challenges will help you build effective HR planning.
 

Overall, communication is also one of the essential elements in implementing effective human resource planning. Get a virtual number from Calilio because we provide a number sharing feature. Utilizing the same feature, share your number with multiple teams or members in the oganization, further enhancing team collaboration and engagement.
 

Human resource planning means strategic planning to have the right people at the right place and time.

The four R’s in human resource planning are recruit, rewarding, retention, and retirement.

HRM (Human Resource Management) manages the current staff within the organization, while HRP (Human Resource Planning) determines the talents needed in the organization.

The main objectives of HRP are as follows:
 

• Analyzing current workforce levels.
• Take needed actions for hire.
• Provide necessary training.
• If needed, do staffing changes.

The three components of the human resource planning processes are:
 

• Evaluating workforce demand and supply
• Balance workforce demand and supply
• Taking an action