The Compass to Business Success: Human Resource Planning is Compulsory for All

Imagine steering a ship through unpredictable waters without a skilled crew or a clear route. Similarly, a company navigating the competitive business world needs careful planning and the right people in the right roles. This is why human resource planning is compulsory for every organisation. It ensures that businesses have the correct number of employees with the necessary skills at the right time.

With effective HRP, organisations can avoid overstaffing, understaffing, skill shortages, and misalignment with business goals. In this article, we will explore why human resource planning is compulsory for the success of any organisation, outline the steps involved, and highlight the benefits, particularly in the context of Indian businesses.

What is Human Resource Planning?

Human resource planning is compulsory for understanding how many employees a company needs and what skills they should have.

Employment planning is mandatory as it shows the number of employees required in the establishment and the required competency levels.

It is as if creating a scheme for developing the company’s workforce in the future. This planning assists the firm in being prepared for any shift in the market, technology, or business environment.

Here are some key points to understand why human resource planning is compulsory for companies:

  1. Forecasting Demand and Supply: Estimating the number of employees and which attributes they should have.
  2. Recruitment and Selection: Recruitment is the process of attracting, screening, interviewing, selecting and, finally, employing the candidates suitable for the particular position.
  3. Training and Development: Offering employee training to bring out the best talent in them.
  4. Performance Management: Rating with which employees are performing their tasks and duties.
  5. Succession Planning: This is to develop the human capital for the future, in which employees must perform essential activities.

Why Human Resource Planning is Compulsory for Organisations

  1. Ensures Adequate Staffing: Human resource planning is mandatory to ensure the organisation is adequately staffed to respond to the goals. It assists in forecasting future requirements and preparing the required preparations.
  2. Improves Efficiency: Therefore, this means that when planning, companies can easily avoid cases of either understaffing or even cases of overstating. This is good for overall efficiency and productivity. With this ability, a management system needs to improve a firm’s operational efficiency.
  3. Cost Management: Thus, HRP plays a vital role in controlling the overall costs associated with attracting, developing, and maintaining human resources.
  4. Skill Development: Human resource planning is mandatory to identify competency and skill gaps and manage and develop the trained human resources in the organisation. This ensures that the human being or labour force is competent and competitive in equal measure.
  5. Succession Planning: In this regard, HRP assists in organising future organisational leadership because it involves identifying and nurturing potential leaders. This is important for long-term wealth creation.

Steps in Human Resource Planning

Human resource planning is compulsory for any organisation to succeed, and it typically involves the following steps:

  1. Analysing Organisational Objectives: Realisation of the aim and objective of the company.
  2. Forecasting Demand and Supply: Forecasting the likely demand for employees in the organisation in the coming years and comparing it to the present available supply.
  3. Gap Analysis: Achieving awareness of existing workforce skills and comparing them with desirable and foreseen skills in the future.
  4. Developing HR Strategies: Developing mechanisms to help bridge the gap, including recruitment, training, and development policies.
  5. Implementing HR Plans: Implementation of the strategies and plan.
  6. Monitoring and Evaluation: These involve frequently reviewing the plans and making adjustments where and when needed.

Benefits of Human Resource Planning

Human resource planning is compulsory for achieving several benefits:

  1. Better Utilisation of Resources: That powerful asset, human resources, must be utilised wisely.
  2. Employee Development: Emphasizes the development of the organisation’s employees.
  3. Risk Management: This is useful in managing risks associated with human resources.
  4. Improved Morale: If these aspects are planned and managed well, the productivity and morale of the employees will increase.
  5. Strategic Alignment: In this circumstance, an organisation can link the HR strategies with the rest of the business strategies.

Example: Human Resource Planning in the Indian IT Industry

The Indian IT industry is a perfect example of why human resource planning is compulsory for organisations. 

The industry is highly dynamic and requires constant adaptation to new technologies and skills. To remain competitive, companies like TCS, Infosys, and Wipro invest heavily in HRP.

Steps in HRP for the Indian IT Industry



Analysing Objectives

Understanding market trends and company goals

Forecasting Demand

Predicting future skill requirements

Forecasting Supply

Assessing current workforce and future availability

Gap Analysis

Identifying skill gaps

Developing Strategies

Creating training programs and hiring plans

Implementing Plans

Executing recruitment and training activities


Continuously evaluating the effectiveness of HR plans

Challenges in Human Resource Planning

Human resource planning is compulsory for overcoming several challenges that organisations face:

  1. Changing Technology: Given the rapid pace of technological advancement, new knowledge always emerges in IT.
  2. Globalisation: Leadership must cope with a multiracial, multinational, multicultural workforce spread across various locations.
  3. Regulatory Compliance: Compliance with different labour laws/regulations/policies in the workplace.
  4. Economic Fluctuations: Economic fluctuations and their relation to its operations.
  5. Workforce Diversity: Dealing with staff with different backgrounds and characteristics

How to Overcome Challenges in Human Resource Planning

Human resource planning is compulsory for overcoming these challenges through:

  1. Continuous Learning: Promoting ongoing training and education enables employees to reach their full potential.
  2. Flexible Strategies: Careful transition and adjustment of the implemented HR strategies.
  3. Effective Communication: Accurate and concise information passing within the organisation to avoid confusion.
  4. Technology Integration: Applying the idea of planning with the help of HR software and tools.
  5. Stakeholder Engagement: The most appropriate technique for implementing the planning process involves all stakeholders.

Human Resource Planning in Small Businesses

Human Resource Planning cannot be optional; the best ‘social profit’ strategy is to make small businesses compulsorily take human resource planning.

This means that while small businesses may not have the capital to invest in HRP as large corporations, the outcomes are positive for all implementing efficient HRP strategies. It assists him in organising limited resources and planning and preparing for growth.

HRP Benefits for Small Businesses

Given below are the benefits for small businesses: 



Cost Management

Efficient use of limited financial resources

Skill Development

Training employees to take on multiple roles

Risk Management

Preparing for uncertainties

Growth Preparation

Planning for future expansion and hiring needs

Employee Retention

Creating a supportive environment to retain key employees


Human resource planning is compulsory for the success of any organisation, big or small. It ensures that the right people are in the right place at the right time, improving efficiency, cost management, and employee satisfaction. 

Whether in the fast-paced Indian IT industry or small businesses, effective HRP is crucial. By understanding and implementing the steps of HRP and overcoming the associated challenges, organisations can achieve their strategic goals and thrive in a competitive environment.

Human Resource Planning is Compulsory for : FAQs

Q1. What is human resource planning?

Human Resource Planning (HRP) is the process of forecasting and managing the supply and demand of human resources in an organisation to ensure the correct number of people with the right skills are available when needed.

Q2. Why is human resource planning compulsory for organisations?

HRP is essential to ensure adequate staffing, improve efficiency, manage costs, develop employee skills, and align HR strategies with business goals.

Q3. How does human resource planning benefit small businesses?

HRP helps small businesses manage costs, develop employee skills, prepare for growth, retain key employees, and mitigate risks.

Q4. What are the steps involved in human resource planning?

The steps include analysing organisational objectives, forecasting demand and supply, conducting gap analyses, developing HR strategies, implementing plans, and monitoring and evaluating.

Q5. What challenges can human resource planning help overcome?

 HRP helps address changing technology, globalisation, regulatory compliance, economic fluctuations, and workforce diversity.

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