Irrespective of the size of your organization, you must make your staffing or manpower decisions carefully. After all, poor planning with regards to your human resources results in either overstaffing or understaffing. Both of which can act as major roadblocks in an organization’s growth.
Understaffing vs Overstaffing
Understaffing often results in unnecessary delays, unproductive hours, unsatisfied customers, and unfulfilled orders. Additionally it can result in uncontainable losses for your business! On the contrary, overstaffing leads to additional and pointless cost burden. It can diminish your competitive advantage and efficiency of your business. Also to add to these challenges, eliminating extra staff can lead to legal complications. Such as extra cost in terms of compensation.
Planning the staff levels therefore, is of critical importance. It involves evaluation of both the present and future requirements as compared to the present and predicted future resources.
Your first step needs to be to assess the current human resource situation. You need to have a complete profile in terms of age, skill set, experience, potential, present performance, etc. Next comes making forecasts for short term i.e. 1 to 3 years or long term i.e. 5 to 10 years. All the while keeping in mind the adjustments to be made for retirement, employee turnover, dismissals and intended employee movements. It is during this forecasting stage you will need to also account for mentoring programs. Either the one you already have in place or are considering to launch.
It is important for you to remember these projections need be in line with the business goals and objectives. Outlining your future staff forecasts need to also be based on various factors like:
- sales and production projections,
- modifications in government policies,
- changes in technology,
- employment decisions such as outsourcing and
- changes in workforce efficiency due to training and motivational techniques.
Once your future demand is assessed, you need to find adequate sources for recruitment of new hires. Your business may opt for either external sources of recruitment. This can be done using your own Human Resource department or contracting it out to an independent third party. You may also look for employees within the organization through promotion and training, i.e. mentoring programs.
Manpower planning is challenging to say the least. But focusing on it while preparing your business plan will ensure you are prepared. That there is never a huge gap between your demand and supply of employees your business needs. Admittedly, this would require a great deal of information gathering, segregation and use of complex statistical analysis. But also the advantages of proper manpower planning are numerous. Demand- supply equilibrium of employees. Smooth functioning of your organization, career planning of employees and optimum utilization of your workforce.
At the end of the day your organizations success largely depends on the quality of your human resources. Therefore any effort made in terms of developing and managing them is bound to be worth the reward!