Describe the three major phases of the HRP process model.

Question

What will be an ideal response?

Answer 1

Phase 1: Setting HRP Objectives, which requires estimation of the needed supply and demand of human capital in the future.
Estimating Demand. The first activities in phase 1 of the HRP process involve estimating demand for the total number of employees in a future business scenario. Based on the strategic goals of the organization, whether it is for an increase or decrease in market share, the forecasted demand is an estimate of the number of employees by job category needed to handle the increase (decrease) in market share. This forecast must be calculated by the HR department based on the historical records of changes in human capital based on changing market share environments.
The other part of this demand estimate comes from the annual average employee turnover, again, by job. Adding the forecasted need for employees based on the strategic objective to the average employee turnover rate by job provides an estimate of the total demand for human capital.
Estimating Supply. The estimation of the supply of available labor involves two components, external and internal. The external component is obtained from recent estimates of the potential availability of new employees by experience and skills in the company’s geographic labor market. The source of data for the internal supply estimate is based on the historic movement of employees within the company by job—for example, the number of promotions and lateral transfers of employees between jobs. These two estimates of supply are combined to provide an estimate of the total supply.
Phase 2: Planning HR Programs based on the difference between the demand and supply estimates. Subtracting the supply from the demand figures can result in a negative or positive gap. If the gap is positive this would indicate a need for more employees and may indicate more emphasis and budget on recruitment and selection programs. The gap could be negative (more supply than demand), indicating a decrease in the need for future employees. This situation could occur, for example, in a company downsizing its workforce due to weak annual sales.
Phase 3: Evaluation and Control, which involves the implementation and evaluation of the planned HRM programs from phase 2.