1

HUMAN RESOURCE
 2

I. Module Overview ……………...……4

II. Pretest …………………………...…….6

III. Key Terms …...………………….…..7

IV. Activity 1 …………………………......7

V. Abstraction …………………..……..…8

VI. Activity 2 ………………………….....14

VII. Post Test …………………………....15

VIII. Answer Key…………………………16

IX. Performance Check

Point ..……………………..........….16

X. References …………………………….17
 3

SSE 124_HUMAN RESOURCE MANAGEMENT

A course module

THE AUTHORS. Ms. Fatima Grace D. Fabillar and Ms. Ma. Louise M.
Roperez is a part of the Secondary Education Unit of Leyte Normal
University.

LEYTE NORMAL UNIVERSITY PRESS

Paterno St., Tacloban City, Philippines 6500
ISBN-01 123-4-567-89012-3

© Leyte Normal University 2023

All rights reserved. No part of this publication may be reproduced, distributed, or

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except in the case of brief quotations embodied in critical reviews and certain other
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publisher, addressed "Attention: Permissions Coordinator," at the address below.

fatima.fabillar@lnu.edu.ph or malouise.roperez@lnu.edu.ph

Leyte Normal University has no responsibility for the persistence or accuracy of URLs for
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presented as our work.
 4

Module 2 introduces you to the different aspects of Human Resource Planning. The
module is divided into the following topics:

UNIT II: HUMAN RESOURCE PLANNING

a. Meaning and Purpose of Human Resource Planning
b. Coordination
c. Consideration
d. Concentration

1. The module contains a total of 4 learning tasks that you must complete within the
timeframe specified below.

ACTIVITY # TIMEFRAME DEADLINE

PRETEST February 13-19, 2023 February 19, 2023
1 February 13-19, 2023 February 19, 2023
2 February 13-19, 2023 February 19, 2023
POSTTEST February 13-19, 2023 February 19, 2023

2. Word file outputs should follow the format below.

Font name: Times New Roman Margins: 1”
Font size: 12 Orientation: Portrait
Font Color: Black Paper size: A4
Spacing: 1.0

3. Handwritten outputs should follow the guidelines below.

Paper: Intermediate Pad

Font style: Single Stroke (No Erasures)

4. The filename should constitute your surname and activity number (i.e.,
Roperez_ Activity#1). Upload your file to the corresponding assignment section
in the Google Classroom. You are encouraged to submit your answers on time.
 5

At the end of the module, you are expected to:

1. Discuss what is human resource planning and its importance.

2. Examine the four stages of human resource planning process.

3. Analyze various scenarios related to human resource planning.

You are expected to submit the following:

1. Module pretest
2. Lesson activities
3. Module posttest
4. Performance checkpoint

This module aspires to introduce you to the different aspects of Human Resource
Planning.
 6

INSTRUCTIONS: This is a 5-item multiple-choice preliminary test designed to measure

your prior knowledge and readiness for module 2. Read each question carefully and
choose one correct answer by encircling the corresponding letter.

1. Which of the following is NOT a component of the Human Resource Planning?

a. Compensation
b. Concentration
d. Consideration
d. Coordination

2. It reveals the current strengths of the organization and how they can be
maintained in terms of its market position or standing.
a. Behavior Analysis
b. Issue Analysis
c. Performance Analysis
d. SWOT analysis

3. The following personnel should be considered in the HRP team, EXCEPT one.
a. Contractual Workers HR
b. Information Technology Professionals
c. Finance / Budget Analysts
d. Support Professionals

4. It refers to the total number of employees leaving the organization divided

by the total number of employees in an organization.
a. Actuarial losses
b. Involuntary turnover
c. Turnover
d. Voluntary turnover

5. It is used to identify vacancies in superior positions and the possibility of filling

those vacancies current employees through horizontal or vertical movements.
a. Replacement Chart
b. Skills/Competency Mode
c. Succession Planning
d. Trends Analysis
 7

1 Human Resource Planning

2 Forecasting Internal Supply

3 Succession Planning

4 Forecasting External Supply

INSTRUCTIONS: Create a flow chart map on “Human Resource Planning.”

 8

It is difficult to imagine how a company can continue functioning without human

resource planning (HRP). The human resource planning sees to it that the company
can achieve its mission and vision by having the right people with the right skills in
the right departments at the right time. The strategic objectives of the organization
in the different functions are accomplished with the employment of people suited for
the different tasks assigned to each department (Zarate, 2014). This lesson stresses
the importance of human resource as a core resource in any organization. Moreover,
the four stages of HRP process – environmental scanning, forecasting human resource
requirements, decision analysis, and action plans or program implementation – are
also discussed.

• Human resource planning (HRP) means devising plans, strategies, and tools to provide
the right number of people with the right skills and qualifications at the right time.
• HRP sees to it that the company can achieve its mission and vision by having the right
people with the right skills deployed in the right departments at the right time.

HUMAN RESOURCE PLANNING

Manpower Demand and Supply (Number, Skills, and
Qualifications)

RESEARCH AND
FINANCE MARKETING TECHNICAL PRODUCTION
DEVELOPMENT

• The number of people as well as their skills, abilities, experience, and educational
background will always matter to the other departments since human resource is a
core resource. One department cannot function independently or avoid coordinating
with the other functional departments.
• It is critical to highlight the link between human resource planning and the overall
strategies of the organization. The strategic objectives of the organization in the
different functions are accomplished with the employment of people suited for the
different tasks assigned to each department.
• To accomplish its mission and vision statements, which are specifically highlighted in its
strategic objectives, a company should effectively employ and utilize human resources –
manpower in all aspects of its operations.
• The accomplishment of the company's strategic objectives is always grounded on the
following: quality product service offerings, a highly reputable corporate image, and
competent and reliable personnel.
 9
• HRP has three components: coordination, consideration, and concentration.

COORDINATION CONSIDERATION CONCENTRATION

• The HRP process is summarized in the following diagram.

• COORDINATION
Coordination is a term used to describe how HRM through human resource planning
coordinates with the different departments to strategize the right number of employees
and positions needed in each department. It is the process in which an organization
attempts to estimate the demand for labor and evaluate the size, nature, and sources
of supply which will be required to meet the demand (Reily, 2003 as cited in Armstrong,
2009).
• Environmental scanning is critical to HRP because it assesses the factors that presently
affect the labor market as well as the ability of the company to respond to these factors.
For example, the current economic conditions have a great impact on the labor market.

• As a process, HRP looks at the organization's strengths, weaknesses, opportunities, and

threats (SWOT). SWOT analysis reveals the current strengths of the organization and
how they can be maintained in terms of its market position or standing – how its
products or services fare in the market; and how its weakness in its current distribution
set-up can reduce personnel capability to transport its products in certain key cities. In
terms of opportunities, there is a big chance for the company to succeed in a new
branch or area, even if the likelihood of failing or getting surpassed in another area is
not far behind.

• SWOT analysis can determine how many people are currently employed in the
organization and how many personnel occupying different positions are in each
department. It can spell the difference between getting new personnel, retaining the
same number of people, or laying off some employees. It is very critical in planning out
the organization's manpower complement.
 10

• FORECASTING HUMAN RESOURCE REQUIREMENTS

Forecasting refers to the decision maker's perception of a certain behavior based on an
objective study of the factors affecting the perceived behavior. In short, this is making
predictions based on critical factors to come up with a key decision. Predictions on human
resource requirements are an example.

• CONSIDERATION
Consideration or the estimation of the costs of employment of human resources is also
done in human resource planning. By considering both the costs and the right number of
employees, human resource planning ensures that the organization has employed
responsible and trustworthy people who can attain the company's objectives.

• During the second stage of the HRP process, there are certain considerations that the
HR should deal with. To be successful, there is a need for an HR manager to be guided
by the following information (Bulmash, Chinnzer, & Speen, 2010).

THE HUMAN RESOURCE PLANNING (HRP) TEAM

The HRP Team should consist of individuals across all levels and departments who
understand the value of HRP in the organization. Once chosen, they should commit
themselves to the execution of the plan. The following personnel should be considered in
the HRP team:

Senior Members of Top Top management provides the necessary support and the
Management “go ahead” signal to execute the plan.
The department or line managers assist in analyzing the
Department Managers human resource requirements and aligning them correctly in
the organization.
 11

The HR professionals are the support group that ensures

HR Support Professionals that department managers are provided with all the help
they need to implement the process.
Information Technology
The IT professionals undertake the process automation.
Professionals
The financial/budget analysts make the necessary linkages
Finance / Budget Analysts between human resource requirements and the
corresponding monetary limitations.

CURRENT AND LONG-TERM WORKFORCE REQUIREMENTS

• During HRP, there are certain changes that must be made on the current workforce.
The HR department should replace those who are due for retirement, consider those
who can be promoted, and investigate current vacancies that need to be filled
immediately.

• It is also important to be concerned with long-term workforce requirements. During

HRP, a succession scheme becomes crucial to key management positions. Employees
who have the potential to assume key positions should be identified and honed further
to be future executives in the organization.

EVALUATION OF THE COMPANY'S CURRENT ROSTER OF PERSONNEL

• There is a need to assess how many regular or full-time employees and part-time
or temporary workers there are in an organization. The group of temporary hires is
called contingent workers.

• In evaluating the workforce, a skills inventory is needed. It entails comprehensive

information on an employee's educational background, experience, compensation
history, and specialized skills. The beauty of HRP is that it not only takes charge of
future human resource requirements but also equips employees with the skills that
may be needed to attain the company's organizational goals.
 12

ASSESSMENT OF EXTERNAL LABOR ENVIRONMENT WHICH AFFECTS

THE FUTURE SUPPLY OF EMPLOYEES
• The external environment is evaluated on the basis of the average number of
graduates and the corresponding courses per year, as well as the average age of
the labor force. It is also imperative to identify what industries are labor-intensive
and which among them grow faster in terms of profitability, as this can also affect
the number of workers employed.

FORECASTING EXTERNAL SUPPLY

> In forecasting external supply, it is necessary to determine potential employees from
information available in government offices such as the Department of Labor and
Employment and the National Statistics Office. There are also private websites where
one can access employment statistics, and industry data (e.g. People Management
Association of the Philippines, JobStreet.com, and colleges/universities websites). The
information gathered from these sources can help in understanding future HR supply.
FORECASTING INTERNAL SUPPLY
>In forecasting internal supply, there are actuarial losses which are unavoidable in
any organization. Actuarial losses refer to life events like death, disability, and
retirement (Bulmash et al., 2010). An organization can plan these life events through a
study of occupational health risks, medical histories of employees, and other data related
to the average age of the incumbent workforce.
> Information on what causes turnover should be considered. The term turnover refers
to the total number of employees leaving the organization divided by the total number
of employees in an organization. There are two kinds of turnovers: voluntary and
involuntary. A voluntary turnover refers to resignations which are initiated by the
employees. An involuntary turnover refers to dismissals and layoffs initiated by the
employer.

METHODS OF FORECASTING INTERNAL LABOR SUPPLY

TREND ANALYSIS
>Trend analysis is a simple method used in forecasting internal HR supply.
The main requirement in using trend analysis is a record of past trends. Future
trends can be predicted easily through past retirement, hiring, and turnover
patterns. For example, the company can assume it has a yearly percentage of
 13

5% retirement, 4% resignation, and 2% dismissal. Summing up, the trend of

turnover is 11% per year.

>The advantages of using trend analysis are that it is easy and inexpensive.
Information on past trends can be accessed without difficulty as long as yearly
HR audit is done in the organization. However, trend analysis is limited to
organizations with stable HR trends. In complex organizations, trend analysis
cannot be used alone. It can only be used as a preliminary step in
understanding the current workforce better. Another disadvantage is that in
its simplicity, it can ignore or overlook significant events which have occurred
during the present year or recent years.

SKILLS / COMPETENCY MODELS

> A competency includes skills, abilities, knowledge, and personal attributes

and traits which are needed for a particular position and the required tasks
in such a position. Based on the information gathered from the skills
inventory, the skills / competency model matches the skills and
competencies needed for each job with those of the employees in the
organization. Usually, an organization considers the top performers and
compares them to other employees.

> Just like trend analysis, the competency model considers the HR audit. The
advantage of using this model is that it provides a good picture of the
competencies of the employees, which helps in setting up an ideally
competent workforce in the future. This kind of competency model is also
less costly and easy to employ.

> However, there are certain disadvantages caused by its reliance on the HR
audit because there is no guarantee that the past information contained
therein is valid. Failure to obtain accurate information in the past audit will
make the competency model useless. Just like the trend analysis, a
competency model should not be the sole basis in forecasting HR internal
supply.
 14

REPLACEMENT CHART

>The replacement chart is used to identify vacancies in superior positions and the
possibility of filling those vacancies current employees through horizontal or
vertical movements. In horizontal movements, also called lateral movements,
employees are transferred to another position but of the same level. Vertical
movements refer to promotions or the advancing in position such as from a
supervisor to a manager, or from a production operator to a supervisor.

> The advantage of this method is that it clearly identifies the top performers and
the vacancies they can fill in the organization. Another advantage is the
organization's easy identification of a person who will fill a particular position in
the future and the time to adequately prepare people who will replace those
leaving the superior positions.

> However, the disadvantage of a replacement chart is that it can only be applied
to internal movements. The replacement chart can only rely on the employee's
performance, education, and readiness to fill the vacant position. The employee's
age, gender, and civil status can be included in the chart to gauge the potential
of employees to be placed in higher positions. Demographic information can be
a source of bias, so it may occasionally lead to potential discrimination (one
employee is promoted instead of the other). An example is when a male
employee is promoted over a female employee with the same performance,
education, and readiness to fill the position.

SUCCESSION PLANNING

> Succession planning traces the potential replacements to key positions and
hones them to become successful future leaders. Succession planning is a long-
term process since grooming a successor entails training, mentoring, and
coaching the potential employee until the time that he/she assumes the key
position. The obvious advantage of succession planning is that it adequately
prepares successors to assume key positions. On the other hand, it is
disadvantageous and expensive to hone and train a potential leader who may
decide to leave the organization sometime in the future for a better pay or
position elsewhere.
 15

STAFFING TABLES

>Staffing tables are graphical representation of all jobs and the persons
assigned to each job. The chart aids the organization in understanding the
current mix or combination of employees. It presents a simple visual
understanding of an organization’s staffing level within each department and
the organization as a whole, in an effort to help understand the combination of
employees that make up an organization’s internal workforce. This information
is useful in evaluating staffing levels by department, branch, project, the types
of staff at each level, and the combination of staff in all categories.

>Staffing tables help the organization predict HR internal supply by assuming a

constant mix of employees in the organization. Using the chart, the
organization can make adjustments concerning the predicted number of
employees in the future. However, numbers do not indicate anything, making
staffing tables mere preludes to more complex forecasting methods.

MARKOV ANALYSIS

>The Markov analysis is named after Russian mathematician Andrei

Andreyevich Markov. It forecasts internal movements from one year to the next
year by determining the percentage of employees who remain in their jobs, are
promoted, transferred, dismissed, or have resigned for the organization. Each
employee is rated on the probabilities based on projections. This type of
analysis identifies areas of high turnover so the organization can focus on the
probable causes and how they can be minimized.

>It helps to predict internal employee movement from one year to another by
identifying percentages of employees who remain in their jobs, get promoted
or demoted, transfer, and exit out of the organization. By tracking and
predicting employment movement within an organization, the Markov analysis
allows for the development of a transition matrix to forecast internal labor
supply.
 16

>The table below presents a simple matrix using Markov analysis for a 12-
month period. The Markov analysis is useful in identifying how many are likely
to be promoted so that the organization can prepare for possible vacancies
created by those who will be promoted.
PRODUCTION
POSITIONS RESIGNATION MANAGER SUPERVISOR
WORKER
PRODUCTION
20% 80% 0% 0%
MANAGER
PRODUCTION
10% 20% 70% 0%
SUPERVISOR
PRODUCTION
10% 0% 10% 80%
WORKER

>In this example, the production supervisor has a 10% probability of resigning,
a 20% probability of getting promoted to a managerial position, and a 70%
chance of remaining a supervisor next year. Each employee is rated on the
probabilities based on projections. This type of analysis identifies areas of high
turnover so the organization can focus on the probable causes and how they
can be minimized.

>On the other hand, Markov analysis may underestimate the size of the
organization and such a mistake will lead to a failure in forecasting. The
company should be large enough to provide pertinent information on the
different jobs and occupations. Another disadvantage is that the Markov
analysis is only effective for stable trends. An organization with very high
turnover rate or periodic changes in the workforce cannot use it.

CONCENTRATION
> Human resource planning sees to it that there is a concentration of activities and tasks
in each department by making sure that the right number of workers and positions are
obtained.
>The concentration of efforts is very crucial in the organization's achievement of its
strategic objectives. In determining the shortage or surplus of manpower, it is very
important to forecast future requirements.
 17

FORECASTING HR DEMAND

• DECISION ANALYSIS
During this stage, HR conducts a gap analysis - the process of finding the
difference between the forecasted HR supply and HR demand. Decision analysis
identifies three crucial decisions:

> Labor equilibrium where HR demand equals HR supply.

> Shortage of workers where HR demand is more than HR supply.

> Surplus of workers where HR supply is more than HR demand.

• ACTION PLAN / IMPLEMENTATION OF THE PROGRAM

After gap analysis and a particular decision is obtained (e.g. a labor equilibrium,
shortage, or surplus), the organization is now ready to identify the strategies for
its implementation.

1. Labor Equilibrium (labor demand equals labor supply)

> During labor equilibrium or status quo, current employees are trained and
developed further in their respective fields. Labor equilibrium is an ideal situation
but this happens rarely.

2. Labor Shortage (labor demand is more than labor supply)

> There are several ways to address labor shortage. The first option is to schedule
overtime work hours. This is an additional cost to the company, but it may help
in avoiding work backlogs on a temporary basis.

> Another option is to hire contractual or temporary or project-based workers.

There are workloads or projects that will last only for a short time like six months.
Temporary workers can be hired. Another option is to outsource the work.
Instead of hiring directly, a company may use a third party and let the latter get
its own people to do the tasks such as customer service.

>Lastly, a labor shortage can be solved by external recruitment. There are several
methods on how to recruit the best people qualified to fill the vacancies in the
organization.

3. Labor Surplus (labor supply is more than labor demand)

 18

> The company has several options when there is a labor surplus. When this
occurs, the company looks at the attrition rate of the employees. Attrition is the
normal separation of employees from the organization such as resignation or
retirement.

> The company may also opt to offer an early retirement program for those who
have reached the age of fifty. An early retirement package should be planned
carefully in order for it to effectively entice people. A higher separation pay will
enhance the offer's appeal.

> Another option is to declare a hiring freeze. A hiring freeze prevents new hires
and assigns qualified incumbent personnel to fill job vacancies.

> Layoff is another option for a company that wants to get rid of redundant
positions since some manual services or functions may no longer be needed
because of technological innovations. When a layoff occurs, the company reviews
the performance of its current workforce and may decide to terminate employees
with consistently low performance ratings for the past several years.
VII. ACTIVITY 2 19

INSTRUCTIONS: Identify and discuss one (1) common Human Resource issue in the
workplace or organization and articulate the feasible measure or solution to address this
concern. The output will be graded based on the following criteria.

POOR (4-1 FAIR(9-5 GOOD (14-10 EXCELLENT (20-

CRITERIA
POINTS) POINTS) POINTS) 15 POINTS)
Writing
demonstrates a Writing
Writing
Writing minimal demonstrates a
demonstrates an in-
demonstrates reflection on general reflection
depth reflection on
Depth of lack of reflection the selected on the selected
the selected topic,
reflection on the selected topic, including topic, including
including supporting
topic, with no a few some supporting
details and
details. supporting details and
examples.
details and examples.
examples.
Information Information
clearly relates clearly relates to Information clearly
Information has to the main the main topic. It relates to the main
Quality of
little to do with topic. No provides 6-10 topic. It provides 1-
Information
the main topic. details and/or supporting 2 supporting details
examples are details and/or and/or examples.
given. examples.
Writing is mostly
Writing is
clear, concise, Writing is clear,
unclear, and
and organized concise, and well
Writing unclear, thoughts are
with the use of organized with the
disorganized. not well
Structure & excellent use of excellent
Thoughts make organized.
Organization sentence/paragra sentence/paragraph
little to no Thoughts are
ph structure. structure. Thoughts
sense. not expressed
Thoughts are are expressed in a
in a logical
expressed in a logical manner.
manner.
logical manner.
VII. POSTTEST 20

INSTRUCTIONS: This is a 5-item multiple-choice posttest designed to measure your

knowledge for module 2. Read each question carefully and choose one correct answer by
encircling the corresponding letter.

1. Which of the following is NOT a component of the Human Resource Planning?

a. Compensation
b. Concentration
d. Consideration
d. Coordination

2. It reveals the current strengths of the organization and how they can be
maintained in terms of its market position or standing.
a. Behavior Analysis
b. Issue Analysis
c. Performance Analysis
d. SWOT analysis

3. The following personnel should be considered in the HRP team, EXCEPT one.
a. Contractual HR Workers
b. Information Technology Professionals
c. Finance / Budget Analysts
d. Support Professionals

4. It refers to the total number of employees leaving the organization divided

by the total number of employees in an organization.
a. Actuarial losses
b. Involuntary turnover
c. Turnover
d. Voluntary turnover

5. It is used to identify vacancies in superior positions and the possibility of filling

those vacancies current employees through horizontal or vertical movements.
a. Replacement Chart
b. Skills/Competency Mode
c. Succession Planning
d. Trends Analysis
 21

Scan the QR Code to get the

answer key for Pretest and Posttest.

PERFORMANCE CHECKPOINT

Find out how you performed in Module 2 by accomplishing the

Performance Checkpoint Chart below:

Are you
What do you
satisfied with What are the
need to do to
your challenges in
Requirements Rating maintain or
performance? accomplishing
improve your
Explain your the tasks?
performance?
answer.

Pretest Result

Activity 1

Activity 2

Posttest Result

FACULTY COMMENTS
VII.REFERENCES 22

“Forecasting the Supply of Human Resources”. (n.d.). Retrieved from

http://www.jiwaji.edu/pdf/ecourse/management/Forecasting%20the%20Suppl
y%20of%20Human%20Resources.pdf
“Staffing Tables Example”. (2014). Retrieved from https://www.slideserve.com
/lars/hrms
Armstrong, M. (2009). Human Resource Management Practices (11th ed). London:
Kogan Publishing.
Bulmash, J., Chhinzer, N., & Speers, E. (2010). Strategic Planning for Human
Resources (1st ed.). Canada: McGraw-Hill.
Zarate, C. A. (2014). Human Resource Management. Quezon City, Metro Manila: C
& E Publishing, Inc..

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