The internal factors to be considered when planning the human resource requirements for an organisation are the internal planning force, demands for products/services, technological change, skill requirements, workforce profiles (age, gender, ethnicity, ability) and new markets. Internal planning factors are within the business to help the organisation change to cope with new methods of work or new demands; it may be the business is being introduced to new technology or new product lines. Also it maybe developing new skill so that the workforce can work more efficiently.
The demand for products and service is important, if the demand for these change for a business it has a affect on human resources because it can affect the level of service or amount of products that are required in order for the business to be cost efficient. This has on-going affect on the amount of staff that will be required from the business so they can be profitable whilst being able to provide a good service. Business can find it difficult to cope with an unexpected increase/decrease in demand and result into the business reducing the number of staff and have excess capacity meaning having too many products/services compared to number of customers which must be considered by human resources..
An organisational needs technological change for it to become more efficient and for it to be able to adjust to busy periods, by having technological change it means that the work force arrangement will be altered because a service will no longer be required because it can be completed by the new equipment. Staff may no longer be required or may be shifted within the business to complete other tasks which may mean additional training is required. Therefore this means human resources are in charge of re-locating staff and introduce the additional training.
Skills requirements is essential to human resources planning as it helps the business to build a profile of training so they have clear understand of what is required for certain staff. Having staff that have has essential training means they can work more effectively at their tasks so it is in the company’s best interest to provide the training. Depending whether the business is capital-intensive (involves a lot of machinery and technology) or labour-intensive (requires a lot of human resources) will depict what training is required. To remain competitive the business will plan future training and introduce new training so their staff remain an efficient work force.
Workforce profiles is maintained by human resources, this allows business managers to see the different types of employees they have working for them, they can see their age, gender, ethnicity and ability. Knowing information about the current is helpful, having employees of a high age can alert human resources that they will need to be recruiting because it is likely there will be a lot retirements in the nearby future. Also having a workforce profile means the business can avoid breaching the employment equality regulations 2006, they can show differentiation within their workforce and demonstrates whether there is equality of opportunity.
To increase business a company must consider new markets, to do this it may mean they expand or target new audiences to buy a new product/service that they now provide. To do this new employees may need to be hired or existing employees may need new training to be able to provide the service or fulfil the tasks. It may involve human resources to see if any current employees have any skill/qualification that can benefit the new market that wish to enter.
External planning factors Circumstances that affect the business from other sources other than the business. External planning factors must be frequently revised so a business can abide by new laws or economic change so it can remain efficient and profitable. It could be demand for a product/service, government policies, change in nature of work, workforce skills, labour market competition and impact of automation. These are out of a business’s direct control so human resources must be able to adjust.
Supply of labour needs to be taken into consideration by human resources on a local, national and international scale. Different types of labour have become obsolete, some more scarce and others have become more saturated because of its demand for example service industries have become more demanded whilst mining has become a more scarce trait. This means training has become more of an issue because its important employees has the correct skills especially in an organisation that is not as common locally because employee will not have the appropriate skills. Regionally some industries more popular depending on the area therefore training may not be as demanded. Some industries have products/services that are trends whether its long term/ short term meaning training required either way but may not apply to the industry for long if the trend ceases.
Labour market competition, human resources must have business plans for the future for it to differentiate from other business’s within the industry. If a business has plans to expand it is important for them to have enough employees and to know if there is enough potential employees for them to satisfy this, if not then it is likely for a business to pay a higher wage to influence people to apply rather than another business which is not willing to pay as much.
Employee expectations, human resources are to make sure that employee expectations are met to some degree so that a business can be more attractive to work for, as well as to benefit the employee and employer. Employee that now work full time generally work 35+hours a week on a permanent basis unless they choose to leave or are dismissed (due to a contract) Employees may need flexible hours because they need to look after their children/relatives therefore they can work part-time meaning less hours. Some employees may just need temporary work through busy seasons such as Christmas which can benefit employers because the demand may rise.
Impact of Automation, technology has become more common for a business to use because it may product product/ provide services faster and they are generally more cost efficient than a employee, this means human resources need to offer training for employees to learn how to operate the machinery. IT skills are generally more demanded in modern society but can differentiate between industries depending on whether technology is used.
Government policy, Human resources must be up to date with their understanding on government policy incase if affects the industry the business is in. An introduction of policies for education, work and training mean that it affects the number of potential employees available and their abilities when they leave school.