(M1) Explain why human resource planning is important to an organisation
Human resource planning is very important in any organisation whether it’s large or small as
it is the development of strategies for matching the size and skills of the workforce to
organisational needs. Organisations plan their human resources in order to have enough
suitable employees needed for the everyday running of the business; businesses should
therefore have a good understanding and knowledge about their human resources in order
to be able to plan their labour effectively and in a professional manner, although this might
not always be a simple process because there are a few factors that affect labour planning,
some of which are:
Employment trends – In an organisation there are constantly on-going changes, and
employment is no different. Change in employment trends is one of the aspects that affect
human resource planning in an organisation; therefore a business should always keep this in
mind and follow the trends. As an example I would like to give a very common employment
trend: In the modern society employees are likely to change their job positions frequently.
Nowadays it is also very important for employees to be computer literate as software is
changing at a fast rate and staff is expected to know the latest version of software
programs.
Skills shortages- is yet another employment trend that highly affect labour planning in an
organisation because if there is a shortage of skills management will have a difficulty with
finding the right staff for the running of the business resulting in an organisation having to
spend more money on finding skilled employees which would also be time consuming as the
process would take much longer. In a case where there is a skills shortage, the organisation
could consider hiring employees with skills more or less suitable for the needs of the
company and providing them with training and coaching- balancing out skills availability
with the organisational requirements.
Competition for employees- Competition between employees is very high nowadays which
is an advantage for an organisation in terms of human resource planning as most employees
present themselves in the most excellent way possible and perform well in order to get
recognised by their colleagues and the management. Competition is an employment trade
which forces employees to work efficiently and at a highly professional level knowing that
they could be replaced by a more talented and skilled employee at any time.
Availability of labour- is another factor which has a big importance in labour planning.
Organisational costs are lower with availability of labour and higher with lower availability;
meaning the business would spend more money on finding new labour, with the right skills
and qualifications; which would also be time consuming and vice versa; when there is a high
availability of labour the organisation spends less time and money on finding suitable staff.
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