2.13 Summary
Summary
HR Planning is a strategic process that helps companies plan for future human resources. HR can predict or anticipate numbers of employees needed with a good HR plan. The HR plan involves reviewing business goals, scanning the environment, identifying gaps, developing the plan and measuring the progress. As well, organizations have limits on the amount of money or resources they can receive and pay. Budgets are used to plan financial resources for short term or long term periods.
Forecasting is the estimate of future human resources needs. Several methods are used in forecasting that include nominal group method, delphi method and trend projections. The next step is to convert results into staffing tables. Companies need to understand the supply and demand of employees. HR departments can estimate internal supply to fill in the gaps. Companies need to respond to supply and demand by developing strategies to either reduce the workforce or increase their workforce.
The financial position is a company’s ability to accomplish its short and long term goals consistent with its strategy by developing financial statements as a way to communicate financial performance and position. These include an income statement, statement of owner’s equity, balance sheet, and statement of cash flows. Financial statement analysis reviews financial information on the financial statements to make informed decisions about the business. Three common analysis tools are horizontal analysis, vertical analysis, and financial ratios. HR needs to understand financial data. It has its own resource of HR analytics (Human Resources Information Systems) that can be synchronized to help speak the language of financial executives.
Human Resources Information Systems (HRIS) allow companies to track data and use the information to plan for human resources. The HRIS can be tailored to the needs of the company. Human Resources uses the information for recruitment, selection, training, performance management, and health and safety. The HRIS helps to organize and manage the people-related data. HR analytics allows HR departments to deal with the metrics of the HR function to analyze data to improve work performance. It deals with things such as timing of hiring, training expenses, and time until promotions. The analytics helps companies make decisions about quality of employees, matches candidates to job descriptions, and can measure an employee’s success.
