To the extent that these results can be measured, they can form the basis for evaluating the success of SHRM planning. Another approach is to measure projected levels of demand against actual levels at some point in the future. But the most telling evidence of successful SHRM planning in an organization is when the human resources are consistently aligned with the needs of the organization over a period of time. There are several actions HRM personnel can take to link HRM planning to the organization’s strategic plans. These are discussed in the next section.
to look at the knowledge, skills, and abilities (KSAs) of current employees but to determine the KSAs required to meet the objectives. For example, suppose an objective of the production department is to increase overall production of a specific product by 15 percent. Once this objective has been established, the production department must determine precisely how this translates into human resources needs. A good starting point is to review current job descriptions. Once this has been accomplished, the
production department personnel is in a better position to determine the KSAs necessary to meet their objectives. The final step in this phase is to translate the needed KSAs into types and numbers of employees.
Determining the Additional (Net) Human Resources Requirements Once a manager or team has determined the types and numbers of employees required, they must
analyze these estimates in light of the current and anticipated human resources of the organization. This process involves a thorough analysis of presently employed personnel and a forecast of expected
changes.
HRM personnel often rely on the use of a skills inventory to analyze current and future personnel changes. A skills inventory consolidates information about the organization’s human resources. It provides basic information on all employees, including, in its simplest form, a list of the names, certain characteristics, and skills of employees. In addition to appraising present human resources through a skills inventory, managers must take future changes into account. Managers can accurately and easily estimate certain changes but cannot so easily forecast other changes. However, information is almost always available to help make these forecasts (i.e., changes such as retirements, transfers and
promotions, resignations, discharges, etc.). By combining the forecast for the human resources needed with the information from the skills inventory and from anticipated changes, managers can make a reasonable prediction of their net human resources requirements for a specified time period.
Developing Specific Action Plans
Once the net human resources requirements have been determined, managers and other personnel must develop specific action plans for achieving the desired HRM results. If the net requirements indicate a need for additions, decisions must be made about whether to make permanent hires, temporary hires, or to outsource the work. If the decision is to make permanent or temporary hires, plans must be made to recruit, select, orient, and train the specific numbers and types of personnel needed. If the decision
is to outsource, then potential vendors for outsourcing must be identified and evaluated.
If a reduction in human resources is necessary, plans must be made to realize the necessary adjustments.
If time is not of the essence, natural attrition can be used to reduce labor personnel. However, if the organization cannot afford the luxury of natural attrition, it can cut overhead either by reducing the total number of employees or by making other adjustments that do not result in employees leaving the
organization.
In successful organizations the SHRM plan provides a road map for the future. The plan identifies where employees are likely to be obtained, when employees will be needed, and what training and
development employees must have.
Integrating the Evolving SHRM Process
As should be seen from our discussion thus far organization objectives are influenced by many
environmental factors (i.e., competition, globalization, changing technology, workforce diversity, etc.).
Once the organizational objectives have been established, they are translated into divisional and
departmental objectives. Managers and other personnel then determine the human resources necessary to meet their respective objectives. HRM personnel assimilate these different requirements and determine the total human resources demand for the organization. Similarly, HRM personnel determine the
additional (net) human resources requirements based on the information submitted by the various organizational units in light of available resources and anticipated changes. If the net requirements are positive, the organization implements recruitment, selection, training, and development. If the
requirements are negative, decreasing or downsizing the workforce must be realized through attrition, layoffs, terminations, early retirements, or voluntary resignations. As these changes take place, they should be reflected in the skills inventory. SHRM planning is an ongoing process that must be continuously evaluated as internal and external conditions change.
To be effective and to contribute to organizational success, SHRM plans must be closely tied to and correspond to the broader organizational planning process and plans. This means that like organizational plans SHRM plans should be classified as short range (zero to two years), intermediate range (two to five years), or long range (beyond five years). Ideally, an organization prepares a plan for each of these time horizons and the forecast factors impacting SHRM plans. These forecast factors are demand,
supply, and net human resources needs. For example, human resources demand in the intermediate range could be operating needs from budgets and plans. Supply in the intermediate range could be the human resources vacancies expected from individual promotability data derived from devel-
opment plans. Net results in the intermediate range could then be the numbers, kinds, dates, and levels of human resources needs. In short, there are a number of short-, intermediate-, and long-range factors that affect SHRM planning.
In successful organizations SHRM planning efforts are viewed not as an all-or-nothing process but as falling at some point along a continuum. At one end of the continuum are those organizations that do no SHRM planning; at the other end are those that completely integrate long-range SHRM planning into their strategic business plans.
One expert has identified a number of benchmarks, or stages, along this continuum. Stage 1 companies have no long-term business plans, and they do little or no SHRM planning. Organizations at stage 2 have a long-term business plan, but tend to be skeptical of SHRM planning. At the same time, such
organizations do realize to some degree that SHRM planning is important. Stage 3 organizations do engage in some aspects of SHRM planning, but for the most part these efforts are not integrated into the longrange business plan. Stage 4 organizations do a good deal of SHRM planning, and their top
managers are enthusiastic about the process. These organizations have at least one human resources component integrated into the long-range plan. Stage 5 organizations treat SHRM planning as an
important and vital part of their long-term business plans. Obviously, organizations at stage 5 are highly enthusiastic about SHRM planning and view it as key to their overall success.
Again, successful organizations require that each step in SHRM planning is a joint effort of the HRM personnel and the various managers and other employees in the organization. An important role of HRM personnel is to coordinate, monitor, and integrate the process. HRM personnel often provide the
structure and establish the timetable to be followed by departmental or operating managers. This helps ensure a unified effort. As managers determine their human resources needs, they can channel this information through, or even develop this information with, the HRM staff to be coordinated and integrated. By funneling all the information through a central source, they can attain maximum efficiency in the process—efficiency that is key to today’s organizational success.