Very importantly, overstaffing reduces the competitive efficiency of the business. Overstaffing is wasteful and expensive, if sustained, and it is costly to eliminate because of modern legislation in respect of redundancy payments, consultation, minimum periods of notice, etc. Understaffing loses the business economies of scale and specialization, orders, customers and profits. Manpower planning involves reviewing current manpower resources, forecasting future requirements and availability, and taking steps to ensure that the supply of people and skills meets demand. Manpower Planning is the development of strategies to match the supply of manpower to the availability of jobs at organizational, regional or national level. Internal agencies such as the personnel department, industrial engineering, plant manager and finance department as all these agencies are interested in production, productivity, industrial relations and other aspects of manpower planning. It is generally done in the initial stages or when internal agencies do not have the required expertise for manpower planning. In an industrial undertaking this is done very carefully by-Įxternal agencies such as professional consultants and suppliers of plant and machinery for they have the knowledge of working of similar units. It is an important factor of labour productivity and profitability of the enterprise. Manpower planning is needed wherever production of goods and services is involved. Formulating transfer and succession policy Controlling the cost aspect of human resourcesģ. Avoiding imbalances in distribution or allocation of manpowerĢ. Optimum manpower planning therefore assumes importance.ġ. Under-staffing also affects production morale and, therefore, industrial relations. Over-staffing not only increases direct cost (salary) but adversely affects the cost of training, housing amenities etc., besides production cost. Improper planning may lead to either over-staffing or under-staffing, both of which should be avoided. Manpower planning requires not only a simple assessment of the number of men required but also their categories and skills as well as their balanced allocation. In order to achieve a goal, manpower requirement needs to be assessed, located and harnessed. That is why man learned the use of manpower much before he learned to use other resources. Even a fully automatic unit such as an unmanned satellite requires manpower to execute it and plan further improvements/activities. Manpower is a primary resource without which other resources like money, material etc. Though the organisation of men for managing a purpose is an age-old thing, the science of management is still in nascent stages. Factors to be Considered for Manpower Planning.
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