Human Resource Planning is
Key to Your Business

Human resource planning is a key activity for business; as it is very likely that your business cannot operate without people. Even a business with the owner as the only employee of the business counts - planning and managing one employee (yourself) is just simpler (or perhaps harder).

Human resource (HR) management is an important staff function for business; and the human resources plan needs to be part of the overall business plan.

For effective workforce planning, you need to include your human resource plan as part of your overall business plan outline checklist, as understanding when the business plan predicts growth that needs to be supported by human resources planning is a key planning function.

As part of the human resource planning process, first identify how many staff you presently employ (full time, part time, contract): include the length of service as of the date of the plan; include the employee demographics, such as age, sex, first language spoken; include the employee training that you have conducted; include any current-year lay-offs or employee termination issues; and any other characteristics that might affect your plan.

Also review reasons for firing employees and/or for employees quitting: wrong fit, poor hiring practices, no or poor testing, the job wasn't as described, the employee oversold his/her skills, and more. Address these reasons in your planning process.

If you are a one-person business, still consider human resource planning for the future: it is likely that as with business growth, your human resource needs will grow.

Then, define your human resources vision and mission: it needs to be closely aligned (if not the same) to the organization's mission and vision statements. Next, identify the primary (top 5) goals of your plan (workforce planning should always be one of those goals due to the importance of having enough of the right people in the business).

Here is a human resource planning example of the Top 5 HR goals for my business, Voice Marketing Inc. (VMI):

• Goal #1: VMI employees will have a safe and supportive workplace. Every business needs a safety plan.

• Objective: Develop a safety checklist and operate the business to ensure all safety regulations are met. Reduce workplace injuries to Zero. Involve employees (through an internal committee or team) in making their environment a safe place to work. Support health and wellness programs through an optional, additional-cost, benefit program.
• Strategy: The safe and supportive workplace goal will be supported by a company program to engage employees in individual health practices and improvements and ensure that their physical work space is appropriate and safe. Provide access to flexible work programs and work-from-home programs. Ensure the at-work environment is ergonomically best.
• Measures of success: Reduction in injury; reduction in time-off requests; reduction in absenteeism related to on-the-job injury; getting employees back to work as quickly as possible - likely through a work accommodation program (e.g. light duties; half days, etc.); regular safety inspections; regular safety meetings with employees; regular ergonomic assessments.

• Goal #2: To be recognized as a preferred employer.

• Objective:There are a number of programs across North America, and likely across the globe, that recognize the "Best Employer" in certain categories (by industry, by number of employees, etc.). Apply to these programs (as appropriate) and ensure that the business is structured as a Best Employer business.
• Strategy: Recruiting employees will be easier with a 'brand identity' of being a 'best' or preferred employer. Job applicants will look for the "best" employers. Develop active recruitment policies that reach out to potential employees.
• Measures of success: Ask new hires why they applied, where they heard about, or saw, the employment opportunity information. Assess the impact of Best Employer status internally by seeing if internal applicant referrals increase.

• Goal #3: To reduce employee turn-over and to increase employee retention.

• Objective: Reduce employee turn-over by 35% in year one (this can be done by retaining good employees and by making better hiring decisions).
• Strategy: Reduce employee turn-over and increase retention, through mentorship programs; through strong new employee orientation programs; recognition programs; through offering competitive employee compensation programs (within industry).
• Measures of success: Orientation programs must be completed within first 30 days (measure); mentor feedback; performance evaluations completed on time and annually (and worded in a positive manner); exit interviews to discuss why the employee is leaving and then acting on that information; increase number of new positions filled from posting within the company. Do an annual survey of employees to assess how they feel about the organization - listen to employees and act on the key elements of what they have to say (if you don't act, tell them why).

• Goal #4: To be a learning organization.

  • Objective: Build a performance review program to include training and learning components; track employee development; develop in house training programs - train employees to be able to train others; ensure that good training is available to all employees.

    This objective is particularly important in a business with a changing marketplace.

  • Strategy: To develop training learning outcomes for internal training; develop a knowledge database that employees can easily access; develop budget for training.

  • Measures of success: Measure trained employees against the learning outcomes predicted (established); track the usage of the knowledge database (# of hits; number of pages reviewed, length of time online) - if one page is reviewed often maybe that subject needs some focused training for all employees; was the training budget spent?

• Goal # 5: Workforce planning

• Objective: To forecast professional labor needs for the period. (In other businesses, this would be expanded to predict skilled and unskilled, full time and part time labor needs.)
• Strategy: To consider demographics in the workforce plan (older employees may be looking for reduced work hours or retirement; younger employees may be looking for quick progression and/or new learning opportunities); identify talent pools (people's capabilities and cross-capabilities); identify career paths for key employees (all employees if you have the time); identify best-fit recruiting solutions. Make sure that progression criteria and program is clearly communicated (perhaps in your employee handbook .)
• Measures of success: Promote on basis of capability - now and in the future: how successful are the promotions; what is the turnover rate by department; are talent pools being utilized - if an individual can be used in several areas is he or she being deployed in several areas?; have career paths been discussed, planned and communicated with employees (and with their input); are all the positions filled; what is the open position number; how long does it take to fill a position?

Good human resource planning and management will result in good rapport and communications between employees and the management, low employee turn-over, low absenteeism, low safety incidents, high morale, good quality output and efficient operations, well trained employees, and satisfied customers.

Your human resource planning needs to identify and include the employment standards it operates under (reference the source documents), to identify the industry requirements, to identify any agreements such as union contracts or employee agreements, and to incorporate business plan elements such as sales plan - including seasonality issues (not just volume), business operations plan, business financial plan, etc. into the workforce plan.

The workforce plan needs to identify human resource needs on a part time, full time or contract basis. Your human resource planning must include job descriptions for all positions, salary ranges for each position, track who is being paid what at the present time and where they are in the range of their position. Salary competitiveness (within the industry) needs to be reviewed regularly, likely at least every two years. The plan needs to identify your hiring and promotion policies. It needs to provide and update job application forms, sample letters of acceptance, sample termination letters, all employee policies and practices. The plan also needs to identify skills gaps and identify training requirements, training budget and either in-house trainers or outside training programs.

Human resource planning is a critical element of your business plan.

Ensure that you spend time and effort to develop a strong HR plan that clearly identifies your present and future needs, policies, gaps, goals and actions.

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