HR Planning: How to Apply Human Resource Planning in Practice [2023]

as the covet pandemic was ending in 2022 airplane company Boeing realized it had a problem during the pandemic orders for new airplanes had dropped by over 90 percent but commercial flights started to bounce back and 2023 was set to become a record year for newly ordered airplanes now this was good news for the company but not for HR as part of their HR planning the company realized that there was a huge shortage of skilled labor to meet the expected growth of the business the company calculated that over the next 20 years more than 130 000

new airplane technicians would be needed in the U.S alone to repair maintain and overhaul airplanes worldwide the shortage was estimated to be 600 000 technicians what do you do as a company when you realize that there's a huge shortage of skilled labor if you do not have the workers you will not be able to deliver the airplanes that have been ordered in this case Boeing invested in vocational training programs like the Boeing pre-employment training program where students from specific academic manufacturing programs can skip the interviewing process altogether and join Boeing directly it also partnered with

schools and colleges to nurture Talent from an earlier stage all these and more initiatives were taken to ensure that the company would be able to hire enough technicians to deliver all the airplanes that were ordered these initiatives are all part of Boeing's HR planning as the company is making sure that it has access to enough talent to deliver all its airplanes on time hi my name is Eric from vulpan and in this hrd dive you'll learn everything you will need to know about HR planning you'll learn what it is and how you can apply it

to your organization using our aihr HR planning model so buckle up and let's get started but before we do remember to smash that like button subscribe and activate the notification Bell to stay up to date [Music] so what is HR planning and why is it as important as keeping our airplanes in the sky HR planning is the process of identifying the human resource or Workforce needs of an organization and developing strategies to meet those needs it's about forecasting your organization's demands for talent and balancing it with the available Talent Supply the key to effective HR

planning is understanding your business's strategic objectives that means being able to answer questions like how many people do we need to realize our strategy what skills should they have when do we need them by and how scars are these skills in the market this is where the Boeing example really takes off the company was able to identify the skills Gap in their industry and took steps to address it without strategic HR planning Boeing might have faced a harsh lending unable to fulfill orders due to the massive lack of skilled technicians by aligning their HR strategy

with the business needs they ensured a smooth flight ahead so HR planning isn't just a handy tool it's an essential part of a company's flight plan towards success let's now look at an HR planning model and how you can apply this in your organization our HR planning model has two sides a demand side on the left and a supply side on the right our first order of business in HR planning is to forecast our human resource demands here we answer the question how many people do we need to realize our organizational strategy estimating HR demands

involves assessing future needs for human resources based on the organizational strategy which includes the goals and the Strategic direction of the organization the strategy dictates what the company will do which in turn influences the number of employees required to execute these plans we won't do a full analysis of Boeing strategy because that will take way too long but the company had invested in few efficient and low emission airplanes like the 737 Max which became very popular next budgets and Investments your financial resources and planning investments will determine the head count and skills you can hire

for as new orders were flowing and for Boeing a lot more budget became available for new hires also the geographical location of your organization and potential expansion plans they'll impact the local labor market you're tapping into and the kind of employees you can attract Boeing decided to set up a 737 Max assembly line in Everett in Washington state meaning that they would have to hire and relocate more people there and last the quantity and composition of the future Workforce this until the future demands of the workforce in terms of size skills and demographics here Boeing

expected the number of airplane orders to exceed pre-pandemic levels as airplane companies ordered new airplanes and had to overhaul their aging planes as well which they didn't do during the pandemic as you can see in our example you can forecast the type and the number of employees your organization will need in the future based on these factors this forecast will guide the creation of a Personnel plan to meet these demands ensuring your organization will be able to reach its strategic goals but before we get to our Personnel action plan we need to forecast labor Supply

as well which you can find on the right side of our model forecasting human resource supplies about understanding the talent pool available to the organization four elements shape HR Supply first the internal labor Supply this refers to the existing Workforce are there potential successors or employees who could be upskilled or reskilled Boeing had to cut many jobs during the pandemic to survive so internal capacity was dwindling second is the external labor market the external labor market supplies new hires but you must consider factors like competition for talents economic conditions and demographic Trends here we saw

a massive Global shortage of technical talents third is retention capability a company's ability to retain employees is vital in managing a steady supply high employee turnover can disrupt your supply demand balance and means you need to hire more people and last the age skills and performance of the current employees assessing your current employees capabilities and potential to grow helps you estimate your internal supply you may have to say goodbye to low performing employees and older employees May retire soon meaning that you have to hire to fill these gaps once you have forecasts that your human

resource Supply you can start to match it with your forecasted Workforce demands that way you can make sure that you have the right people in the right roles at the right time this leads to our Personnel action plan that we use to manage the demand and supply of our Workforce over time as part of the Personnel action plan you can have a personal shortage or a surplus or both when there's a surplus of workers the company May introduce a hiring freeze decide to cut jobs and promotes early retirement despite having too many people you may

also have specific pockets in the organization where you have a shortage of labor for example your technology cyber security or technical departments in that case you shrink parts of your Workforce while expanding these Pockets your personnel action plan is a dynamic document that will change over time in our case Boeing was dealing with a massive Personnel shortage to combat this Boeing proactively started to recruit more workers Implement vocational training to make it easier to join engage with young talents at colleges and universities and invest in robotics and automation to further increase productivity amongst other things

so there you have it HR planning in practice by analyzing its future labor Supply and demands and taking action early Boeing will have a better chance to reach its goals this is a great example of how HR can help the organization reach its strategic goals and provide a vital contribution for business success of course in real life HR planning is much more complex than I can explain in a single YouTube video but now you know at least the basics and you have a useful model that you can apply in your work as an HR professional

yourself to anticipate changes in the workforce if you want to learn more about HR strategy check out our courses at the Academy to innovate HR including our HR manager certificate program where you will learn more about HR strategy you can find the link in the video description now before you go smash that like button if you haven't already subscribe to our Channel and activate the notification Bell I hope to see you in our next HR Deep dive bye-bye