1. The HR Planning Process

While these and other factors influence the specifics of an HR plan, all effective HR planning shares certain fea­tures. It is generally agreed that HS planning involves four distinct phases or stages.

• Situation analysis or environmental scanning
• Forecasting demand for human resources
• Analysis of the supply of human resources
• Development of plans for action

Situation Analysis and Environmental Scanning

The first stage of HR planning is the point at which HRM and strategic planning initially interact. The strategic plan must adapt to environmental circumstances, and HRM is one of the primary mechanisms that an organization can use during the adaptation process. For example, rapid tech­nological changes in the environment can force an organiza­tion to quickly identify and hire employees with new skills that previously weren't needed by the organization. With­out an effective HR plan to support the recruitment and se­lection functions in the organization, it would be impossible to move fast enough to stay competitive.

The problems associated with changing environments are greater today than ever before because success now depends on an ability to be a “global scanner”. Global scanning is, in fact, considered one of the essential skills for managers of the 1990s.

Forecasting Demand for Employees

The next phase of an effective HR planning process is estimating not only how many but also what kinds of em­ployees will be needed. Forecasting yields advance esti­mates or calculations of the organization's staffing require­ments. Although many quantitative tools can help with forecasting, it involves a great deal of human judgment. In addition, many successful HR planners rely heavily on their "gut instincts" about future conditions. For example, plan­ners at Unilever attribute much of their global success to such instincts.

It should be apparent that HR panning requires the co­operation of many people in the organization. A strategic plan must be communicated to operational managers and HR professionals, who must in turn provide higher levels of management with data about their human resource needs. The planners are major sources of data and information for development of strategy. Thus, the HR planning function plays a critical role in making sure that strategy implementation is effective throughout the organization.