Importance of HRP (Human Resource Planning)

 HRP is a multi-benefit tool to the organization. Lets go through the following statements.

• A proper HRP: It leads to the optimum utilization of human resources.  A proper HRP improves productivity and helps in achieving the objectives of an organization.
• Improper or no planning: It leads to disturbance in the flows of work. No HRP may lower production, less job satisfaction, high cost of production and consistent trouble for managers. 
• For an individual: HRP is important because it helps him/her to improve his/her skills. It also helps to utilize his/her capabilities and potential to the utmost.
• For an organization: HRP is important because it improves the efficiency and productivity.

HRP is considered necessary and important for all organizations for one or the other of the following reasons/facts:

1. Forecast future personal needs: HRP is needed to forecast the self requirements for the future. To avoid the situations of surplus or deficit of manpower in future, it is important to plan in advance. For this purpose, a proper forecasting  of future business needs helps managers to determine organization's future manpower needs for this purpose. HRP plays an important role to predict the right number of manpower in the organization.

2. Cope with change: HRP enables the enterprise to cope (face) with changes in competitive forces, markets, technology, products, and governmental regulations. Such changes often generates change in job content, skill demands, number and type of personnel. Shortages of people may be found in some areas while surpluses in other areas may occur.

3. Creating highly talent personnel: The mix of personnel employed in many organizations have shifted toward the high talent occupations-managerial and professional personnel. There is often a scarcity of high talent people. The lead time required to hire and develop each personnel is long. Much effort has to be devoted to long range career development, counseling, planned work assignments , and appropriate rewards. Therefore, there is the need of proper HRP.

4. Implement strategic planning: The modern competitive enterprise engages in strategic planning. Top management evaluates the environment in which the organization operates, assesses the strengths and weakness of the enterprise, sets  objectives, and determines programs for implementation. Human resource planning is an essential component of strategic planning. 

5. Implement equal employment opportunity: The government's equal employment opportunity and affirmative action regulations mandate that employers meet agreed goals for the employment and upgrading of protected categories of people in their work forces. Affirmative action programs must be implemented and monitored in regard to hiring, placement, training, compensation, and advancement. To implement them HRP is highly essential. 

6. Win or satisfy government contracts: Thousands of companies and non-for-profit organizations sell products and services to the government. To bid for government contracts, a firm must supply detailed information on its manpower resources. To be competitive, it must plan for and develop appropriate human resources. To satisfy above requirements HRP in needed.

7. Foundation for HR functions: HR planning provides essential information for designing and implementing HR functions. Examples of them are recruitment, selection, transfers, promoting, layoffs and training and employee development. HRP is needed because it is the foundation for HR activities throughout the organization. 

HRP Practices in Nepalese Organizations

1. Introduction

Manpower planning practices in Nepalese organizations are not encouraging. Most of the organizations' HR planning is based on power base, favour-disfavour, lack of proper system (i.e. adhocism), and guess-work and so on. For simplicity purposes HRP practices can be categorized under various heads or sectors viz., government organizations, bank and financial institutions, public enterprises, private organizations, non-government organizations schools/ colleges, etc. Before we move towards those sectors lets have a quick overview of the HRP scenario in Nepal. The basic nature of Nepalese HRP practices that describes its characteristics (in general) are given below.

Characteristics of HRP practices in Nepalese organizations:

• Lack of formal and systematic HRP culture.
• Overstaffing in government and public enterprises. 
• Understaffing in private organizations/firms.
• Demand for vacancies is low but supply is very high.
• On the one hand, there is shortage of skilled hands but on the other hand, there is over supply of unskilled candidates. 
• Demand and supply forecast is based on ad hoc basis.
• Most of the HRP activities are done for the short-term needs. Organizations do not plan for long-term.

2. HRP Practices in Different Sectors /Organizations

a. Government Offices and Projects

     i. Government offices (GOs) : Existing literature (and news) indicates that most of the government offices are suffering from over staffing. There are a few offices which have under staffing. Considering overstaffing problem, few years ago government  of Nepal (GON) launched 'Voluntary Retirement Scheme - VRS'. Thousands of employees applied for VRS because it was  a "golden handshake package" for employees. As government changes new vacancies are created to give job to the political supporters. 

    ii. Government projects (GPs): A little bit satisfactory situation can be seen in government/donor assisted projects-though most of the top position(s)/appointments are generally controversial. HRP is satisfactory enough in these projects due to: 

• National prestige and pressure from donors. 
• Appointment of consultants/ professionals as well. 
• Some degree of freedom from bureaucracy as compared to government offices.
• Tight time schedule and  budgets, etc. 

The degree of overstaffing is less in these projects as compared to government offices. 

b. Semi-government organizations (Public Enterprises -PEs): The general health of PEs have deteriorated especially after the Jana Aandolan I (Peoples Movement One -2006 B.S.). The situation became worst after Jana Aandolan-II, 2062/063 B.S. whatever practices they were following was satisfactory enough but this is not the the situation today. Almost all PEs have overstaffing. Most of them are in loss. Many PEs have even sold their fixed property(land, building, etc.) to pay salary and benefits of their employees. They have become "Bharti Kendra" of major political parties. The situation of HRP in PEs are : 

• PEs autonomy for HR planning is handicapped by the frequent interventions of government.
• Legal provisions for estimating manpower requirements are seldom followed in practice.
• They have no system of formal succession planning to appoint chief executives. Overstaffing has made HRP irrelevant in government and public enterprises. 
• Very recently, public services commission Nepal has started taking written examination to hire the employees in our PEs. This is a good sign.

c. Government schools and colleges: Most of the government funded schools/colleges also suffer from : (i) lack of proper and formal manpower planning, (ii) general over staffing, (iii) political interference, (iv) brain drain, etc. In some of the schools there are more number of teachers than students. TU has more number of administrative staff than teaching staff (probably a rare case in the globe!) As there is change in government, there will be addition in vacancies (darbandi) .

d. Private sector organizations (PSOs): One of the fast growing employment sectors in Nepal is PSOs. Most of the PSOs are owned and managed by family members-they rarely hire friends and "Near and dear" ones. If they are not capable to do any particular job then only they hire independent employee. Even the big business houses (except few technical positions) lack formal HRP. Whatever HRP they have it is only for short-term purpose and is based on personal guesswork of senior family members. 

e. Banks and financial institutions:  A ray of hope (Aasha ko kiran)  can be seen in private joint venture banks (JVBs) though they too are blamed for understaffing, outsourcing and 'fishing of talent employees' from other banks. They get technical help (to go through formal HRP) from foreign counterparts. Even then, they go through following procedures: 

• HRP is the most neglected aspect of HRM practices. It is the responsibility of HR  department and management committee. 
• The committee decides the number of manpower required for the coming years and submits to the board for the final approval.
• At the time of branch expansion, the strategic workshop decides the number of employees required.
• They also prepare a succession planning of top level employees.

Private finance companies are very small in size so they plan only for technical manpower. For rest of the positions they do not go through formal planning.  They lack succession planning. Both Nepal Bank and Rastriya Banijya Banks are still suffering from over staffing. Now, after restructuring, they have started formal manpower planning but they still need to improve it.

f. Non-government organization (NGOs): There are two types of NGOs namely local and international (i.e., NGOs and INGOs ). HRP situation/practice in NGOs is similar to the PSOs. But the situation of INGOs is different. They usually go through formal HRP  practices. Most of the top positions are filled through foreign applicants-they come from head office. Number of job vacancies is dependent upon grants that they receive from head office (or number of NGOs/projects) that they have to supervise or implement). Though they claim that they are fair and transparent in their HRP activities but the same have not been observed in their actual practices. 

3. Conclusions and Future Directions of HRP in Nepal 

The main issues relating to HR planning in Nepalese organizations are: 

a.  Processes and techniques of formal HRP are not followed properly.

b. There is no clear link between the corporate plan and the manpower plan, especially in public enterprises.

• The country lacks comprehensive HR survey.
• Over staffing in government organizations and under-staffing in private organizations are very common.
• Most of the organizations do not have systematic HRIS/HR inventory and succession planning.
• Even the government has stopped making HR demand forecasts for its developmental planning for the last two to three decades.
• Nepalese labour market is supply driven or supply dominated. 
• HRP is not regarded as a part of overall strategic planning.
• Multinational organizations (especially in the areas of banking, hospitality and manufacturing sectors) in Nepal do prepare formal HR plans and implement them.
• Similar is the case with INGOs. So, this will definitely have a positive impact for HRP in Nepalese organizations in the years to come. 
• There is the urgent need to establish HR planning cell in medium and large sized organizations.