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Blog Human Resources

6 Steps to Create a Strategic HR Plan [With Templates]

By Jessie Strongitharm , Aug 25, 2022

The backbone of any successful business is the people and processes behind it — that’s why creating a human resources (HR) plan is key. This strategic document drives your business forward by evaluating where your workforce is at, and comparing it to future needs. 

Without an HR plan, organizations can suffer from issues that would have otherwise been avoided. From productivity pitfalls to costly employee turnover, there’s no shortage of risks you can sidestep if you do human resource planning in advance. 

Not sure where to start? No worries. I’ve outlined six steps you can take to create an effective HR plan that ensures your organization is well-staffed and well-served. You’ll also find a variety of  HR templates  that you can customize in just a few clicks — no design expertise required. 

Click to jump ahead:

What is human resource planning?

• Assess employees’ current skill levels
• Forecast your labor needs based on available information
• Revisit your organizational design
• Outline how you will manage, motivate and retain talent 
• Align your workforce planning with your budget 
• Establish KPIs for your human resource planning objectives

Human resource planning is the process of considering the current and future “people needs” of an organization.

This involves evaluating an organization’s workforce structure and protocols to ensure operational goals are met, productivity stays high and future demands for labor and talent can be fulfilled. 

The result of this process is the creation of an HR plan, which typically takes the form of a written document sometimes autogenerated using HR software . These documents tend to follow a similar structure to most  strategic business plans  and are created on an annual basis, by HR managers or company leaders.

Check out the template below for an example. 

This eye-catching, one-page  HR Strategic Plan Template  offers a concise summary of your human resource planning efforts, so you can easily share info with colleagues. 

Just swap out the text and visual assets for those of your choosing in  Venngage’s editor , and you’re off to the races. 

6 steps to create a strategic HR plan

Ready to create a strategic plan for the human resources that power your business? Here are six steps to help you succeed at the human resource planning process.

1. Assess current employees’ skill levels

The first step to creating a future-forward HR plan is to assess employees’ current skill sets, and compare them to your operational needs moving forward. This will help you identify gaps and inform any hiring of new employees.

Employees’ skill levels can be assessed by reviewing their work history, hard and soft skills and professional growth over time. 

Using a matrix is a great way to understand where the skill gaps in your current workforce exist. Below is an example that describes the skills needed for different marketing roles. 

Don’t need it for marketing specifically? No worries — you can fully customize this template by swapping in your own text to examine any human resource gaps. 

Another way to assess skills is by giving employees a questionnaire they can fill out. This  Employee Competency Assessment Template  does just that.

Based on the information collected, you’ll get a sense of what positions best suit each individual, and whether any upskilling or hiring is required. 

2. Forecast your labor needs based on available information

Next in your strategic strategic HR management plan, you’ll want to consider the future. This involves accounting for any upcoming changes to your workforce, so operations can continue without error.

When forecasting labor needs, the following should be considered: 

• Planned promotions
• Upcoming retirements 
• Layoffs 
• Personnel transfers 
• Extended leaves of absence (i.e. maternity/paternity leave) 

Beyond those, it’s a good idea to assess the impact of external conditions on your labor needs during your human resource planning. For example, new technological developments may decrease the amount of employees you require to operate your business. 

3. Revisit your organizational design

Organizational design is the process of structuring the way a business operates so it can best achieve its goals. This is hugely important when it comes to your human resource planning process! 

With a clear understanding of your organization’s strategic objectives in mind, reviewing your organizational design allows you to understand the staffing requirements you’ll need to succeed at them. This means taking into account your  organizational structure  and chains of command, as well as how work gets done and the way information flows.

 From there, you’ll be able to see which departments need more team members so it can accomplish the organization’s objectives. 

An easy way to get started is by using an organizational flow chart. 

With its color coding and layout, even a new manager can quickly look at this chart to identify the people responsible for leading teams and making decisions. 

And if there are any changes, it’s easy to to reflect them in the chart itself. All you need to do is customize the text and visual assets in  Venngage’s Chart Maker  as desired. 

Not quite your style? There’s plenty of other  organizational chart templates  to choose from. 

Here’s an organizational chart that’s perfect for small businesses that have limited employees. One quick look, and you’re good to go. 

The bottom line is, no matter how big or small your business may be, you should always revisit your organizational design to optimize your workforce management and business operations. 

Related:  Types of Organizational Structure [+ Visualization Tips]

4. Outline how you will manage, motivate and retain talent 

In this day and age, it’s a known fact that companies must provide more than just a paycheque to attract and retain talent, and encourage growth. 

It’s true —  studies have shown  employees are more engaged in their work when they feel it is meaningful, fulfilling and slightly challenging. So your human resource plan should consider how to inspire such feelings, and what actions you can take to motivate employees to stay. (Hint: a strong HR training and development program is key.)  

The  talent management infographic template  below is a great way to begin. 

Using this  process chart , you can detail the steps you’ll take to retain the talent you have. Reference it as needed in your human resource planning.

 Another great way to keep staff motivated and geared towards their professional growth is by coming up with  ideas for employee development . Facilitating a company culture that champions continuous learning guarantees your team will feel supported and challenged in all the right ways.

The two employee development plan templates below will help you do just that. 

Though both templates are geared towards healthcare organizations, it’s easy to customize their content in Venngage to promote the continuous learning and development of employees in any industry.

 As a result, your employees will be able to reach their full potential, while simultaneously supporting the long-term goals of your organization. 

Related:  6 Employee Development Ideas for Efficient Training

5. Align your workforce planning with your budget 

 Let’s face it, human resources ain’t cheap.

 Meaning, if you struggle at organizing and monitoring your HR budget, you’re bound to overspend on your initiatives —and no financially savvy business wants that. 

That’s why I recommend including financial information in your HR planning process, so you can reference your budget and expenses as needed. This includes not only hiring and training costs but also the complexities of managing a global payroll for diverse teams.

Ensuring this allows you to stay within range as you work towards achieving your strategic goals for human capital . Plus, you don’t need to use one that contains walls of text and wack-loads numbers. Check out the clean and cheery option below — it’s as easy to fill out as it is to understand. 

And if you’re looking to compare a forecasted budget to previous annual spending when strategizing your HR budget, the  Budget Comparison Infographic Template  below will help. 

The bar graph is a great  data visualization  of annual expenses, organized by category. Just add (or import) any values to Venngage’s editor, swap out the text, and you’re ready to compare with ease. 

Related:  10+ Expense Report Templates You Can Edit Easily

6. Establish KPIs for your human resource planning objectives

Measurable results are important when it comes to your HR planning processes, because they indicate whether your strategy is working or not. 

Keeping those metrics in mind, your company can make adjustments and improve upon any future plans — AKA strategize for future success in business. That’s why your human resource plan should include info re: the specific key performance indicators (KPI) you’ll be measuring. 

KPIs are established to help determine if HR strategies and plans are working. Much like those used for evaluating the performance of  marketing  or  sales plan , KPIs for human resources are measurable results that indicate an organization’s success at achieving predetermined goals.

These may take the form of headcounts, turnover rates, demographic information, time to hire and employee satisfaction scores. 

Here’s one employee satisfaction survey you can use to understand your workforce better. 

When you’re ready to organize those HR KPIs in a document, the  recruiting template  below is perfect for keeping tabs at a glance. 

Related:  10+ Customizable HR Report Templates & Examples

How do I make an HR plan? 

After you’ve collected the data you need, you’ll want to convey this info in an engaging, professional manner for easy referencing and sharing amongst colleagues. Given this, using Venngage is the best route to go. 

Here are the simple steps to help you bring an actionable HR plan to life: 

• Outline the information you would like to include in your strategic hr plan
• Pick the human resource planning templates that best suits your needs 
• Customize the templates’ text and visual assets so they speak to your organization 
• Apply your company’s brand guidelines with a few clicks using Venngage’s automated branding feature,  My Brand Kit
• Download and share as desired

Note: sharing is available free-of-charge. However, the option to download your creations and access features like  My Brand Kit and Team Collaboration  are available with a  Business plan . 

FAQ about HR plans

How long should an hr plan be .

There are no hard and fast rules when it comes to the length of an HR plan. That being said, if you’re going to share it with colleagues, you probably don’t want to create a 20+ page document. One to five pages should suffice. 

Try to be as concise as possible when relaying the facts, and use  data visualizations  wherever possible to save room.

Do I need an HR contingency plan?

In the same way creating an HR plan is a proactive move that helps your organization account for future needs, it’s a good idea to devise an HR contingency plan. This ensures there’s a back-up plan in place should your initiatives not go as expected. 

For example, if you’ve identified that you need five new hires to keep up with consumer demand, but the talent pool is lacking, a contingency plan could house suggestions for restructuring your workforce to mitigate this. 

In other words, it’s best-practice to hope for the best, but prepare for the worst. 

Is an HR plan different from an employee development plan?

Yes. While an HR plan is a strategic document describing how an organization addresses its personnel-related needs at a high-level, an  employee development plan  outlines the processes needed to help an individual achieve their professional goals.

 Even though the human resource planning process may involve outlining some employee development tactics, it is not unique to each employee as in the case of an employee development plan.

Make your HR planning processes effortless 

You don’t need a crystal ball to feel confident about your people moving forward. With a solid HR plan and strategy in place, you’ll prime your workforce — and all business endeavors — to succeed in even the most competitive of markets. 

Just remember this: human resources planning, and creating strategic business plans in general, doesn’t have to be exhausting. 

With Venngage’s huge selection of  professionally-designed templates  and easy-to-use editor, all it takes is a few minutes to produce a polished document perfect for all your needs.  Sign up for free today ! 

HR Business Plan Template: Everything You Need to Know

With an HR business plan template, you can help your company recruit new employees, retain existing employees, and guide the development of the workforce. 4 min read updated on February 01, 2023

With an HR business plan template, you can help your company recruit new employees, retain existing employees, and guide the development of the workforce so that you collectively meet your business objectives, regardless of any changes in the industry or economy.

When creating your HR business plan, you need to perform a needs analysis of your workplace to tailor the plan to your company's requirements. You'll also need to learn about the industry standards for your field to make sure you're competitive.

Without such a plan in place, your workers will feel unprepared and won't know how to work towards your company's overall goals.

Steps for Developing a Human Resources Department Business Plan

There are several steps to creating an HR business plan. They include:

• Clarify the requirements . While you might be tempted to create a detailed plan that encompasses the entire company's next 10 years, hold off. Always talk with your boss to see how much detail he or she would like in the plan. This will save you time and help streamline the process. However, there's no harm in creating your own personalized strategic plan for your specific department.
• Read through the HR job descriptions . The HR department typically has employees such as HR assistants, HR generalists, and an HR director . Read through the job descriptions for each worker in the department and see what kind of duties are missing. Brainstorm additional functions that each job role could provide to the company.
• Curate your list . Take the different functions you've brainstormed and compare them to what each member of the HR department is already doing. Are there functions you could add or subtract from each employee for more productivity? You don't have to go into detail here, but just think about how you could improve each role.
• Schedule a meeting with the executives . Before you make any changes, you'll obviously need to get input and approval from the company's executives. They may have more feedback on how the HR department can provide additional services and support the company's overall goals and mission.
• Create a feedback form . Come up with a list of questions to ask leadership about HR's role in the company and provide it to them in advance of the meeting so they have time to think it over and talk with their staff. You may even want to provide a rating and ranking format for the questions, as this will make their responses easy to understand and implement. Overall, this is a key process to understanding what management and employees want and need from the HR department.
• Look at external resources . While the internal information you're collecting is the most important, it also doesn't hurt to take a look at data from professional organizations and websites, such as the Society for Human Resource Management , The Balance , or HR Magazine . You can also ask colleagues from other local organizations for tips on creating your business plan.
• Use this information to make a plan . With your ideas, feedback from executives, and tips from external resources, you should have a clear idea of what your plan should look like. The things that are missing from the HR department should now be clear, and this should guide you on what to focus on to improve HR's contribution to the company.
• Identify goals for this year and next . While your plan can have long-term goals, keep the majority of them a little bit shorter in scope to see how things work out. This gives you the chance to reorganize and restructure if things aren't going right. Consider creating a list of accomplishments you can reach for the end of this year and into the next.

A Real Life Example

If you're seeking more guidance on how to create a successful HR business plan, look to Starbucks as an example.

As the world's largest coffee chain, Starbucks had $21.3 billion in sales in 2016.

Despite these massive numbers, Starbucks maintains the same approach to their human resources department. All of the HR planning is guided by the company's organizational strategy and brand.

Their strategy is to use specific interview techniques when hiring new employees. This lets them identify potential leaders and place them in a "New Partner Orientation and Immersion" training program. With this system, Starbucks has achieved the lowest employee turnover rate in the quick-service restaurant industry.

Starbucks also offers numerous employee perks and dedicates a lot of time to employee training through an online portal that teaches employees essential job skills.

If you need help with your HR business plan template, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.

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Strategic Human Resource Planning (SHRM): Guide to Human Resources & Management

Lucija Bakić

April 5, 2024

Strategic human resource planning (SHRM) is a proactive process that aligns human resource capabilities with long-term business goals.

In this guide, we’ll go through the basics of why this foward-thinking approach is so important for resource planning success . This includes its definition, the main steps, and best business practices. Key Takeaways

• Strategic HR management (SHRM) is a key step to ensuring that businesses are resilient and sustainable in the long run.
• Key steps of the process include: analyzing current capacity, forecasting needs, gap analysis, HR strategy implementation and monitoring.
• Many of the challenges of SHRM, such as resistance to change or tracking KPIs, can be addressed by implementing a modern ERP software solution .

What Is Strategic Human Resource Planning?

Strategic human resource planning is part of the broader human resource plan ning (HRP) strategy. This process targets long-term objectives, spanning from one to five years, and ensures that businesses have enough capacity to meet future needs. Strategic HR planning must be aligned with short-term resource planning, which handles daily concerns, such as employee schedules and workloads. Long-term strategies should also be aligned across departments, such as the finances or management, to ensure that initiatives contribute to shared organizational goals. See more : What Is Human Resource Planning ?

Why Businesses Need Strategic HRP

Some of the critical business questions that strategic HRP addresses can include:

• Will you have enough human resources for future needs?
• Which type of talent will you need (regarding skills, seniority, etc.)
• Which conflicts or gaps could appear in your business workflows ?
• Do you have contingency plans for various risk factors?

Additionally, it can cover broader concerns, such as the need for organizational flexibility or continuous improvement. As an ongoing process, strategic management provides the perfect answer for businesses to tackle and address complex issues.

5 Main Steps of the Strategic HR Planning Process

The four main steps of strategic HRM include analyzing current capacity, needs forecasting, gap analysis, and strategy development and implementation.

1. Analyzing Current Capacity

This step involves analyzing both internal and external business circumstances that are important for future demand. Internal factors usually include details about your current employees, including their productivity, specific skills, availability, and engagement levels. External factors encompass market trends, economic conditions, and industry-specific demands that could influence future resource requirements.

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2. Needs Forecasting

Accurate needs forecasting is one of the most challenging parts of the developing workforce plans . It involves predicting the skills, overall capacity, and roles needed to keep a business relevant during changing market conditions and technological advancements. Therefore, it requires a thorough understanding of your human capital and the industry. Needs forecasting includes:

• Supply forecasting: Assesses the current workforce and external labor market trends to identify whether there will be an excess or shortage of talent in the future.
• Demand forecasting: Focuses more on demand, i.e., quantifying future labor requirements to ensure that business goals will be met.

3. Gap Analysis

Gap analysis takes the first two steps of the human resource management process to pinpoint specific areas of improvement — it compares the current workforce capabilities with future needs to identify conflicts or discrepancies. For example, a retail chain looking to expand its online presence might consider its current capacity, and realize that it has enough technical roles to go into e-commerce. However, by conducting needs forecasting of the competitors, it may recognize the need for marketing professionals skilled in SEO or digital marketing to drive more of their customer base to their website.

4. Strategy Development

The next step involves developing specific strategies to address resource conflicts and help your business reach its goals. Some of these may include:

• Talent management strategies can be developed to address issues with workforce management. It can include processes such as recruiting, retaining, and developing employees.
• Employee engagement strategies are usually developed to tackle low morale and productivity. Organizational strategies might include improving collaboration, manager-to-employee feedback, or capacity building initiatives .
• Development programs are a specific part of talent management, aimed to address skill gaps through upskilling or reskilling employees. Strategies may include mentoring by senior employees, workshops, or other training opportunities.
• Succession planning is utilized to mitigate the risk of key positions becoming vacant unexpectedly. It usually involves identifying high-risk positions and then selecting and preparing potential employees to fill them in the future.

5. Implementation and Monitoring

To ensure that your strategies are effective across time, it’s necessary to closely monitor progress, usually by analyzing various key capacity performance indicators (KPIs). Setting desired targets can be a good way of determining if you’re on the right track — for example, an agency with low productivity might set its desired utilization rates at 80%.

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However, it’s equally important to keep in mind that some benefits of successful ERP can be difficult to quantify or determine in a short amount of time. This can include better workplace culture or increased employee satisfaction. See more: ERP benefits for businesses

Documenting Your Strategic HR Plan

The strategic HR document should include an outline of the organization’s human resource objectives, the strategies for achieving them, and the steps for implementation. Putting your initiatives into writing can help drive alignment across various teams and ensure that everything is progressing according to plan.

How and Where to Create Documentation?

According to research by Forrester, 97% of organizations have minimal or no digitally documented processes. While traditional documentation can be better than no documentation, consider the benefits of automating information gathering and sharing with ERP software solutions .

We used to have a project management tool, a time tracking tool, a support tool, a way we handled opportunities and sales-driven processes. Those were all separate tools that we had, and it wasn’t good. It also meant that all that data was being lost every time we switched between tools , or we had to find a way to normalize the data between them. And now, the fact that it’s all in one, it’s really a game changer.

BRYAN CASLER, VICE PRESIDENT OF DIGITAL STRATEGY AT 4SITE INTERACTIVE STUDIOS

For example, the resource and agency management tool Productive can help you automate the work scheduling process with its resource planning model template, provide real-time reporting on utilization rates, manage employee availability and time off, and more. Another great feature you can consider is collaborative documentation with AI content creation. This can help you keep all essential project data on a single platform.  

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Challenges & Best Practices for Strategic HRP

Some of the main challenges of strategic HRP include ensuring buy-in at all organizational levels, handling resistance to change, efficiently monitoring performance, and fostering continuous improvement.

Getting Business-Wide Buy-In

Organizational changes need to be effected from the top to the ground-level staff. Getting buy-in for new initiatives from leaders and other key stakeholders is essential to get the most out of your HRP initiatives. Silos can cause issues for adoption and cause miscommunications across teams, where one part of the company may not be aware of the changes or understand their role in implementation.

Overcoming Resistance to Change

According to Deloitte, some of the biggest roadblocks to new initiatives include resistance to change (82%) and inadequate sponsorship (72%). Both can be addressed with clear communication and transparency, so that all employees understand why and how initiatives are being implemented. Asigning change ambassadors within teams can facilitate a smoother transition. Learn more: Efficient resource management for multiple projects

Reviewing and Analyzing Progress

Good initiatives can stumble and fall if there’s no way to measure actual performance. Selecting the right key performance indicators and implementing a way to analyze them is important for the success of HRP initiatives. For example, a consulting firm that has issues with turnover might implement additional benefits or hire more staff to balance workloads — the KPIs to be monitored would be employee satisfaction, the utilization rate , and the attrition rate.

Productive can forecast KPIs for professional services agencies, like revenue and profit margins

Incremental Changes and Continuous Innovation

Another reason why monitoring KPIs is so important is that incremental but timely improvements are always better than extensive changes. Smaller adjustments allow businesses to remain flexible and agile to adapt to market demands and internal changes without causing disruptions.

The Role of Analytics & HRP Software

Finally, most, if not all challenges mentioned above can be streamlined with the right tools for resource planning and HR management. The benefits of using such tools include:

• Improved timeline estimation (60%)
• More effective use of resources (55%)
• Enhanced team communication (49%)
• More accurate metrics (38%)

There are many potential options on the market, but consider using a comprehensive software for your strategic planning. These types of solutions can give you a competitive advantage with benefits such as centralized workflows, unified data, and reduced costs for tech stacks.

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As an all-in-one solution tailored to agencies of all shapes and sizes, Productive can help you manage both day-to-day resource management and create strategic plans. Key features include: resource allocation, employee performance management, real-time reporting, project budgeting, workflow automations, and much more. Learn more about Productive by booking a demo today.

What are the 4 HR strategies?

The 4 HR strategies include talent acquisition and retention, learning and development, performance management, and workforce planning and forecasting. Each strategy addresses a part of the human resource planning process and contributes to achieving organizational success.

What is strategic resource planning?

Strategic resource planning is a part of human resource management that examines the capacity and needs of your future workforce for sustainable business growth. It’s focused on ensuring that your business has the critical skills for meeting business goals over a long period of time.

What are the 5 steps in human resource planning?

The 5 main steps in human resource planning include: analyzing current HR availability, forecasting future needs, gap analysis, developing strategies for human resource management, and implementing and monitoring your initiatives.

What is SHRM and its importance?

SHRM or strategic human resources management is a forward-looking approach to managing human resources and aligning HR practices with organizational goals. It allows businesses to remain competitive, sustainable, and flexible in dynamic market conditions.

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Human Resource Planning (HRP) Meaning, Process, and Examples

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

What Is Human Resource Planning (HRP)?

Human resource planning (HRP) is the continuous process of systematic planning to achieve optimum use of an organization's most valuable asset—quality employees. Human resources planning ensures the best fit between employees and jobs while avoiding manpower shortages or surpluses.

There are four key steps to the HRP process. They include analyzing present labor supply, forecasting labor demand, balancing projected labor demand with supply, and supporting organizational goals. HRP is an important investment for any business as it allows companies to remain both productive and profitable.

Key Takeaways

• Human resource planning (HRP) is a strategy used by a company to maintain a steady stream of skilled employees while avoiding employee shortages or surpluses.
• Having a good HRP strategy in place can mean productivity and profitability for a company.
• There are four general steps in the HRP process: identifying the current supply of employees, determining the future of the workforce, balancing between labor supply and demand, and developing plans that support the company's goals.

Michela Buttignol

What Is Human Resource Planning (HRP) Used For?

Human resource planning allows companies to plan ahead so they can maintain a steady supply of skilled employees. The process is used to help companies evaluate their needs and to plan ahead to meet those needs.

Human resource planning needs to be flexible enough to meet short-term staffing challenges while adapting to changing conditions in the business environment over the longer term. HRP starts by assessing and auditing the current capacity of human resources.

Here, identifying a company's skill set and targeting the skills a company needs enables it to strategically reach business goals and be equipped for future challenges. To remain competitive, businesses may need advanced skills or to upskill their employees as the market environment evolves and changes.

To retain employees and remain competitive, HRP often looks at organizational design, employee motivation, succession planning, and increasing return on investment overall.

Challenges of Human Resource Planning (HRP)

The challenges to HRP include forces that are always changing. These include employees getting sick, getting promoted, going on vacation, or leaving for another job. HRP ensures there is the best fit between workers and jobs, avoiding shortages and surpluses in the employee pool.

To help prevent future roadblocks and satisfy their objectives, HR managers have to make plans to do the following:

• Find and attract skilled employees.
• Select, train, and reward the best candidates.
• Cope with absences and deal with conflicts.
• Promote employees or let some of them go.

Investing in HRP is one of the most important decisions a company can make. After all, a company is only as good as its employees, and a high level of employee engagement can be essential for a company's success. If a company has the best employees and the best practices in place, it can mean the difference between sluggishness and productivity, helping to lead a company to profitability.

What Are the Four Steps to Human Resource Planning (HRP)?

There are four general, broad steps involved in the human resource planning process. Each step needs to be taken in sequence in order to arrive at the end goal, which is to develop a strategy that enables the company to successfully find and retain enough qualified employees to meet the company's needs.

Analyzing labor supply

The first step of human resource planning is to identify the company's current human resources supply. In this step, the HR department studies the strength of the organization based on the number of employees, their skills, qualifications, positions, benefits, and performance levels.

Forecasting labor demand

The second step requires the company to outline the future of its workforce. Here, the HR department can consider certain issues like promotions, retirements, layoffs, and transfers—anything that factors into the future needs of a company. The HR department can also look at external conditions impacting labor demand , such as new technology that might increase or decrease the need for workers.

Balancing labor demand with supply

The third step in the HRP process is forecasting the employment demand. HR creates a gap analysis that lays out specific needs to narrow the supply of the company's labor versus future demand. This analysis will often generate a series of questions, such as:

• Should employees learn new skills?
• Does the company need more managers?
• Do all employees play to their strengths in their current roles?

Developing and implementing a plan

The answers to questions from the gap analysis help HR determine how to proceed, which is the final phase of the HRP process. HR must now take practical steps to integrate its plan with the rest of the company. The department needs a budget , the ability to implement the plan, and a collaborative effort with all departments to execute that plan.

Common HR policies put in place after this fourth step may include policies regarding vacation, holidays, sick days, overtime compensation, and termination.

The goal of HR planning is to have the optimal number of staff to make the most money for the company. Because the goals and strategies of a company change over time, human resource planning must adapt accordingly. Additionally, as globalization increases, HR departments will face the need to implement new practices to accommodate government labor regulations that vary from country to country.

The increased use of remote workers by many corporations will also impact human resource planning and will require HR departments to use new methods and tools to recruit, train, and retain workers.

Why Is Human Resource Planning Important?

Human resource planning (HRP) allows a business to better maintain and target the right kind of talent to employ—having the right technical and soft skills to optimize their function within the company. It also allows managers to better train the workforce and help them develop the required skills.

What Is "Hard" vs. "Soft" Human Resource Planning?

Hard HRP evaluates various quantitative metrics to ensure that the right number of the right sort of people are available when needed by the company. Soft HRP focuses more on finding employees with the right corporate culture, motivation, and attitude. Often these are used in tandem.

What Are the Basic Steps in HRP?

HRP begins with an analysis of the available labor pool from which a company can draw. It then evaluates the firm's present and future demand for various types of labor and attempts to match that demand with the supply of job applicants.

Quality employees are a company's most valuable asset. Human resource planning involves the development of strategies to ensure that a business has an adequate supply of employees to meet its needs and can avoid either a surplus or a lack of workers.

There are four general steps in developing such a strategy: first, analyzing the company's current labor supply; second, determining the company's future labor needs; third, balancing the company's labor needs with its supply of employees; and fourth, developing and implementing the HR plan throughout the organization.

A solid HRP strategy can help a company be both productive and profitable.

International Journal of Business and Management Invention. " Human Resource Planning-An Analytical Study ," Page 64.

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Use Human Resources Planning to Forecast for (Less) Risky Business

By Becky Simon | October 18, 2017 (updated July 21, 2021)

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No organization can afford the risk of a critical skills shortage. Human resource planning (HRP) helps to ensure that you have the right people on your team - those with the skills to compete, innovate, or grow your company.

How do you anticipate workforce needs in a business environment where the rate of change is increasing while the number of people with the right skills is shrinking? The answer is human resource planning. In this article, five experts share their perspectives on what’s needed to operate comfortably in rapidly changing times. While human resources (HR) forecasting isn’t an exact science, you’ll find ideas and processes, examples, and templates that you can use to forecast more confidently, manage operations, and take control to increase current and future profitability.

What Is the Meaning of Human Resource Planning?

Human resource planning, also known as workforce planning , helps organizations recruit, retain, and optimize the deployment of people needed to meet strategic business objectives and to respond to changes in the external environment. In order to proactively avoid talent shortages or surpluses and achieve a balance of talent based on need, effective human resource planning is an ongoing, systematic process.

Darrin Murriner is the author of Corporate Bravery , a field guide to eliminating fear-based decisions, and the Co-founder of Cloverleaf.me , a technology platform that helps business leaders and managers build thriving teams.

He says, “Human resource planning and organizational strategy connect at the hip. You can't deliver business strategy without making sure you have the right human capital you need in the right places for the task at hand.”

Smart companies get the human capital part right by implementing a tactical human resource plan that connects directly to organizational and human resource strategies.

Starbucks: Serving Up Human Resources Planning Derived from Mission and Strategy

Starbucks, the world’s largest coffee chain, recorded $21.3 billion in sales for 2016, ranking it at 131 on the 2017 Fortune 500. The company projects that it will reach $35 billion in sales by 2021 by opening 12,000 stores over the next five years , the majority of them in China. How do you plan human resources with such a massive growth goal? For Starbucks, their approach remains the same no matter where stores are located. Their human resource planning flows from its organizational strategy and its brand. People are Starbucks’ primary resource, as their mission clearly states: "Our mission: to inspire and nurture the human spirit – one person, one cup, and one neighborhood at a time." 

An important aspect of Starbucks’ human resource planning is its selection process, which uses specific interview techniques to determine if potential employees are ‘on brand’ and evaluate their skill sets. The company identifies capable company leaders and hires them using a program called "New Partner Orientation and Immersion." This human resources planning approach has led to the lowest employee turnover rate among quick-service restaurants. While most quick-serve restaurants range between 150 to 400 percent turnover, Starbucks’ rate is 65 percent . The company is always on the lookout for new employee perks and focuses energy on employee training, which includes an elaborate online portal that offers an instruction program imparting the necessary job knowledge.

The Difference Between Strategic Human Resources Planning and Human Resources Planning

“The war for talent around the world continues to grow.” says Matthew Burr, Moderator of the Upstate HR Podcast and Principal at Burr Consulting, LLC , a human resource consulting firm focused on small and medium organizations. To win the human capital competition, companies should use a strategic human resource plan as a roadmap to achieve three- to five-year goals. Strategic plans influence the development of tactical resource planning (Starbucks being a prime example). For example, a human resources strategic plan may include long-term aims to recruit and retain an excellent staff with a high-level of technical expertise. The tactical plan would include detailed action plans with completion due dates. For the strategic recruitment goals, the tactical program might consist of short-term goals, such as benchmarking salaries via survey data, or creating a social media campaign to identify and recruit technical professionals. The plan may also target filling IT positions through international recruiting.   

Both strategic and tactical human resource plans support the overall organizational strategy. To learn more about strategic human resources management, read Welcome to the HR Revolution: Strategic Human Resources Management .

Why Is It Important to Plan Human Resources?

Our world is increasingly one of swift technological change, constant product innovation, economic globalization, and generational and cultural shifts. Correspondingly, the life cycles of business designs and products are shortening. Companies must adapt. More than physical or financial capital, human capital efficiently adapts to this new reality. Simultaneously, human capital is at most significant risk of depreciation or obsolescence within a business — and that’s a risk that organizations can’t afford if they’re going to survive and thrive. In fact, only 12% of firms that were on the Fortune 500 list in 1955 remain on the list in 2016.

​“Talented people will always have options; Knowing succession plans, training, leadership development will be a tremendous asset to a growing firm,” adds Burr. “HR planning is critical to organizational strategy: We need subject matter experts and leaders to drive the strategy forward in evolving industries. HR planning plays a significant part in supporting strategy, as human resources are the biggest investment for any organization. Evolving laws and regulations also impact strategy internationally.  Staffing levels, recruitment and retention programs support scalability of any firm or organization.” 

Handrick says it’s all about planning for future growth. “Small businesses that are planning to open a physical or second location also need to think through their HR strategy. Most small businesses begin as sole proprietorships. They need to know when it makes sense to bring on staff, where that staff will work, their compensation, and how to offer benefits, perhaps by partnering with a professional employer organization (PEO).” 

• Improving Company Operations: Human capital management and resource planning is a driver for improved company operations and value creation. In July 2017, a group of institutional investors petitioned the Securities and Exchange Commission to disclose policies, practices, and performance of public companies’ human resources management . The petition signifies a move to use workforce analytics to measure the value of an organization’s most valuable asset in a knowledge-based economy .

“You need to work systemically,” says Adler. “Part of the operating plan has to be a workforce plan. HR has to make sure they have a place at the strategy and decision-making table. In my experience, I’ve seen that HR usually doesn’t get involved until it’s late. In this environment, you need to be moving at the speed of light and not the speed of sound.”

• The Talent Shortage and Demographic Change: In its 2016/2017 Talent Shortage Survey , the ManpowerGroup reported the highest worldwide talent shortage since 2007. Forty percent of employers are having difficulty filling positions, up from 38 percent in 2015. The Harvard Business Review article, Employers Aren’t Just Whining - the “Skills Gap” Is Real , states that “New technologies frequently require specific new skills that schools don’t teach and that labor markets don’t supply.”  At the same time, there’s a demographic change. In most developed economies, the ‘silver tsunami’ - the group of aging individuals that results from ebbing birth rates and graying baby boomers - is surging. The percentage of the U.S. workforce between the ages of 55 and 64 is growing faster than any other age group.
• Technological Change and The New Generation: Millennials now make up more than 50 percent of the current workforce — and will be 75 percent of the global workforce by 2020 . Human resources need to ride this rising tide and learn to welcome technological advancements to meet talent’s expectations and business requirements. Talent and workplace analytics will become customary, and organizations using the data will be far more competitive.
• Organizational Change: With technology driving change everywhere, organizations need to be nimble and often make significant changes in the way they do business. They also need to make changes with care. Research shows that change initiatives are more likely to fail because of poor communication, employee resistance, and failure to adequately prepare. Human resources are an integral part of change management , which is a systematic approach that applies tools, knowledge, and resources to deal with business transformation. The primary goal of change management is to successfully implement new processes, products, and business strategies while minimizing adverse outcomes. Effective change management includes and also goes beyond project management and involves leading the "people side" of the change equation. 
• Government/Legislative Changes: Each state has regulations that affect everything from employee criminal records checks, labor relations, records retention, and mileage reimbursements. Additional federal laws impact human resource management, too. Consequently, human resource professionals need to be conversant in dynamic employment law to minimize company liability. Not being on top of legislation can pose a significant risk to companies and expose them to expensive lawsuits or damage their brand, which can also be off-putting for potential hires.

Seven Steps to Human Resource Planning

There are seven different steps in the human resource planning process, but the pivot point is forecasting demand. That means that today’s human resources professionals need to have a well-rounded picture of their own company and a grasp of multiple factors to put together a plan. “Understanding the three- to five-year business strategy provides what HR must have to forecast workforce needs within the firm,” says Burr. “But there’s also a need to understand the global economy and potential growth options, laws, and regulations to add value to any HR strategy and forecast.”  

The seven steps to creating a human resource plan provide a roadmap for companies, but one size does not fit all. The amount of detail and which factors to include are different for every organization. Startup sole proprietorships working in a single geographic area will need to create an entirely different plan than a multinational enterprise. 

Step One: Analyze Organizational Objectives

Aligning HR practices to strategic objectives is fundamental to an effective human resources plan. In a perfect world, human resources management works hand in hand with other top managers so there is a clear understanding of ultimate goals, and then they focus on the human capital needed to meet them. It’s vital that the human resources plan encompasses every part of the company from product development to sales and expansion plans. 

HR Strategic Plan Template

If your company hasn’t written a strategic human resource plan, this template will help you get started. Modify the template to suit your specific needs or to focus on target areas such as benefits or retirement. Stakeholders will appreciate the basic design when they want to review important aspects of your plan.

‌ ‌Download HR Strategic Plan Template

Need more strategic planning templates to clarify goals for your organization? You can find more free strategic planning templates here . 

Step Two: Inventory Current Human Resources

If you have one, use the updated human resource information storage (HRIS) sys­tem to analyze the number of people you currently employ, along with their skills, perfor­mance, and potential. Once you determine which jobs need to be filled based on your forecast, you can then decide whether you have enough internal candidates to fill the job requirements or if you need to go to external sources or strategies to add staff. 

Employee Evaluation Template

If you don’t have an HRIS system, you can use this performance evaluation template for performance reviews and as a first step in referencing your current human resource inventory.  Adapt this easy-to-use form to gain a better understanding of the duties for each position by identifying gaps in performance and staffing when you review information in the aggregate. This template documents performance against set goals, employee evaluation, and professional development plans for the upcoming year.

Download Employee Evaluation Excel Template

Excel | Smartsheet

Step Three: Forecast Demand

Forecasting human resource demand involves estimating the number of future employees of the right quality and quantity, with a view to the company’s strategic plan over a given period of time. Forecasting demand is the most crucial part of human resource planning and the most daunting. It’s challenging for many reasons, and even more so because there are no absolute answers on how to accomplish it. 

There are two categories of forecasting methods: quantitative and qualitative. You can use both methods to track the work performance of the workforce as a whole, individuals, or business units. Qualitative reports contain anecdotal observations, while quantitative data is statistical or more data-driven. Select the methods that make the most sense in your environment. For example, in a non-manufacturing company, the work-study method which calculates the necessary working hours to produce units may not make sense. By gathering both quantitative and qualitative information, you can identify issues that are impacting your business's productivity, and then develop a well-rounded forecast to increase the company's efficiency, ensure you’re not over or understaffed, and understand future needs.

SWOT Matrix Template

The classic SWOT layout provides a clear view of your compiled findings as they relate to your human resources plan. The template also includes a column for rating the importance of each item by category so you can have a clear understanding of how the analysis elements compare and which will need the most attention. You can add Excel worksheets to hold supporting data and clarify the basis of your findings. 

Download Basic SWOT Matrix Template

If you’re looking for different formats in Excel, PowerPoint, or Word, you can find free SWOT templates here . 

Step Four: Estimate Gaps

With your forecast completed, you’ll have an understanding of future needs and if you will need to fill them with external workers hired full-time, part-time, or as contractors. If you have the right number of employees that don’t have the right skills, you can use training and development to upgrade employee skills to fill the gaps, or you may need to deploy workers in another role.

Employee Training Plan Template

Training is relevant for both employee success and team member retention. Though training takes time and effort, it's essential to have a plan in place to ensure a productive ramp-up period for new employees or existing employees who are learning the tasks and responsibilities of a new role. With this adaptable employee training schedule template, you can create training activities lists, add details about which team members need help to complete each task, track status, and provide a way for the manager and employee to enter feedback.  

Download Employee Training Template

Transition Plan Template

Moving team members to fill different roles can be the ideal solution to filling workforce gaps. When making these changes, ensure that you maintain the information and knowledge the employee had in the initial role. An employee transition plan keeps the information accessible and easy to share. You can also use this transition plan template to assist the person previously in the role train any new team members. Input every aspect of the role that will be useful in the present and future.

Download Transition Plan Excel Template

Step Five: Formulate the Human Resource Action Plan

The human resource plan relies on identifying deficits or surplus in the company. You’ll need to determine if you need to begin recruiting or training, transition, or develop voluntary retirement processes and redeployment in case of a surplus. Include priorities and critical planning issues in your plan.

Action Plan Template

This action plan template provides sections for goals, but you can add more sections to customize it to complete your human resources plan. Goals are translated into actionable steps that you can track to check progress. Assign start and end dates for each action, and take notes about each part of the plan. 

Download Action Plan Template

Word  | Smartsheet

Step Six: Integrating/Implementing the Plan

This is the most challenging aspect of any human resources plan. The organization often invests time and money on plans that are shelved and not utilized. Company executives need to grant buy-in, embrace the plan, and bring the organization on board. Overcome any potential employee resistance to the process by rolling in one aspect of the plan at a time to help employees acclimate to changes.    Staffing or Recruiting Plan Recruitment is one of the top responsibilities of any human resources team. Searching for, vetting, and finding the right talent to join your team are all crucial steps to ensure the success of your organization. Having a staffing plan in place makes your team aware of the available recruitment sources, hiring goals, and budget. Use this staffing plan to organize all staffing details with columns for budgets, hiring goals, status, and comments. 

‌ ‌Download Staffing Plan Excel Template

Candidate Screening Tracker

If you don’t have an automated system, you can track and manage applicants’ cover letters,  resumes, applications, and details about job openings. Tracking this information can be a lot of work depending on the size of the company and current hiring plan. Use this candidate tracker template to organize candidate documentation and details, and ensure that you provide a positive experience for candidates and people involved in the interview process. Track candidate contact information, phone interview questions and answers, status, comments, next steps, and more using this template.

Download Candidate Tracker Excel Template

Onboarding Plan Template

Onboarding ensures proper training and enculturation for new team members, and is also a powerful retention tool for any organization. Develop your own onboarding plan by using this template to plan activities at each stage of the process. Since a full year of onboarding is a best human resources practice, this spreadsheet shows tasks assigned to individual contacts over a twelve-month period. Add or remove columns to create a comprehensive onboarding plan.

Download Onboarding Plan Template

For more best practice information and free templates to support your human resources planning, read Top Excel Templates for Human Resources . 

Step Seven: Monitoring, Control, and Feedback

Strictly monitoring progress helps identify sticking points in your plan and helps you avoid making changes too quickly. It’s essential to compare actions to how the plan is being implemented to ensure fidelity. The human resource plan is an evergreen document that takes changing circumstances into account. Ongoing measurement, reporting, and continuous improvement efforts will keep the company moving towards its stated strategic goals. 

Project Management Dashboard Template

Monitoring all the changes you need to while executing a complicated human resources plan can be time consuming. With this customizable project management dashboard, you can compile every aspect of the process, share status information with management and other team members, and view the big picture at a glance.

‌ Download Excel Project Management Dashboard

Forecasting Is an Ongoing Process

“HRP plans should be reviewed annually, just after the business completes its strategic planning and forecasting for the year,” says Handrick. “For example, if the business plans to open an additional manufacturing location, or offer additional services requiring tech skills not currently in place, then HR will come along and provide estimates as to how many FTEs, what roles, and what kind of skills will be needed. HRP helps with the budgeting for the next fiscal year, and once approved can get to work filling those roles. In a fast-moving environment, HRP may need to be updated with every major change. For example, let's say your organization is project based and you just won a huge contract. Right away your HRP team will need to work with project managers to estimate staffing needs, whether temp or permanent, contract or hire.”

Human Resource Planning Round-Up: Best Practices and Expert Insights

Our experts share their thoughts on some additional issues to keep in mind as you develop your own plan:

• The Importance of Policy Planning: Company policy supports your human resources plan. Policies such as employment classification, benefits, compensation, performance, and improvement are designed to target not only the selection, training, and support of team members, but also to provide guidelines for conduct in and out of the work environment and many other aspects of employment.
• Social Media as Friend and Foe: Social media sites like LinkedIn and Twitter can be powerful recruiting platforms and a friendly, fun way to communicate with team members. However, they can also potentially be an issue when disgruntled employees or competitors get into negative commentary. It’s important to be alert to your company’s social media profile and to take corrective action when the buzz may not be favorable to your goals. 

Sharon Margules, MA, CPC, ACC and CEO of Margules Leadership Consulting says, “The ability of a business to achieve its strategy is largely based on the talent it has to execute. While market and competitive forces can significantly impact the capacity of an organization’s pursuit of its strategy, the explicit capabilities of those doing the work will determine if the result is a success or failure.”

• The “New” Human Resources Professional: “Ultimately, a good HR person is a good business person,” says Adler. “The best HR professionals are system and integration project managers who understand deadlines and highly complex projects. A great candidate has business experience in something other than HR. In my consulting work, I’ve told CEOs that they should look for HR managers with a business background. I think it’s an important consideration, particularly for large firms.”
• More About Markov Predictive Analysis Modeling: One of the most difficult analyses to execute and potentially one of the most valuable tools in forecasting is the Markov model. It’s not a quick fix, but for most mid-to-large companies, it’s worth the time investment to learn how to execute it. For a detailed explanation, read A Markov Model for Human Resources Supply Forecast Dividing the HR System into Subgroups . 
• Leadership and Succession Planning: “HR plays a critical role in enabling leadership, in mature or scaling organizations, to anticipate and understand the talent capabilities that will be necessary to meet their strategic objectives,” says Margules. She lists four items: 
• HR should have a seat at the table when the strategy is being conceived to align on what capabilities are needed, and by when, to realize the strategy.
• HR needs to influence progressive and aggressive budgeting for resource acquisition, training, coaching, and development every year.
• HR must institutionalize effective succession and talent planning practices at all levels, and build an adaptive organization that can flex its structure to optimize performance.
• HR must use far-reaching ideas to retain its key talent and sustain a highly-engaged workforce in a diverse and driven culture. 
• Plan Implementation: “HR plans should align with business strategy and annual plans and should be adaptive to a volatile and uncertain business climate,” says Margules. “While many organizations take a reactive, in-service approach to HR planning and determine their priorities and plans largely in support of annual plans, the most effective organizations are proactive: They anticipate needs and build plans that achieve short term and long term objectives. They adopt progressive practices such as allocating a portion of the staffing budget and resources to recruit and hire key talent for future-focused work. And, they have enough foresight to invest in high potential programs at multiple levels, entry-level accelerated development programs and coaching to build pools of qualified talent for future growth plans.”
• Buy HR Planning Tools or Do It Yourself? “The problem with traditional human resource planning is that it often hasn't supported the scalability of a growing business,” says Burr. “This is precisely why we have to consider new models for talent management, organizational design, and learning and development to ensure that our human resource planning processes can be flexible to meet the scaling needs of the business. This is part of the reason why you have seen an explosion of people analytics tools in the HR marketplace. It is to fill the demand for flexible and scalable models that provide the needed tools for business leaders to plan their people needs as the business grows.”  Adler concurs and says: “I think a spreadsheet can often do a better job. Workforce planning has been around a long time. I think the main point is to be proactive and less reactive in the planning process.”

Five Challenges to Human Resources Planning and Implementation

“People are naturally change- and-risk-averse. Planning and proper support by HR and the people they hire need to happen 100 percent of the time,” says Adler. More often than not, there are some challenges involved in human resources planning and implementation. Here are the five main hurdles:

• Forecasting Is an Imperfect Art: Human resource planning relies on forecasting and supply, which can never be a 100 percent accurate process. 
• Resistant Workforce: Employees may feel that their workload will increase, so they resist the process, or they may be uncomfortable altering familiar patterns in their work life and tasks.
• Ambiguity and Rapid Change: Uncertainties such as labor absenteeism, employee turnover, seasonal employment, technological changes and market fluctuations all affect planning.
• Inefficient Information Systems: Human resource information systems need to be reliable, comprehensive, and up to date. It makes it difficult to plan without good data about current employees.
• Cost and Time Factors: With all of the work hours involved in completing and repeating the seven steps, human resource planning is a time consuming and expensive process, so companies sometimes avoid it altogether, despite the benefits. 

A Look to the Future of Human Resources Planning

Here are some of the themes experts think will influence human resources professionals, their companies, and the people they hire in the near future:

• Going Global: Globalization, the export of U.S. jobs and the import of non-U.S. employees are already underway, as is offshoring (basing services or processes in different countries). “Globally planning can be complex for any HR professional,” says Burr. “It can be a stressful situation for offshoring and outsourcing of jobs within a firm. HR planning should involve a detailed assessment of the new location globally, the workforce demographics, industry competitors, laws and regulations and the potential impact on U.S. jobs. How do we communicate? How do we train? This will all vary by organization, but a strategic HR plan that communicates the information can lessen the impact. With a sound and detailed HR plan, recruiting, retaining and growing talent within the organization will be much easier.”   “Expect more offshore jobs, outsourcing and contract hiring because frankly they’re cheaper, and in many disciplines like finance, IT, marketing, can do the same work for less,” says Handrick. “Other than providing training for supervisors to manage off-site work teams, there's really no difference for HRP except where the line item goes on the plan. For instance, if you know you'll need 12 FTEs next year, and can get four of them offshore, that line item goes to 'expenses' rather than to 'salary' for the remaining eight.”
• More Technology: Social media will likely be in higher use to reach potential workers, particularly millennials who use Twitter, LinkedIn, and Facebook in their job hunts. Telecommuting and the use of social collaboration tools and video conferencing apps will keep people working and in touch with company culture. Emerging platforms will further streamline basic human resources functions to make onboarding and professional development more cost-effective and accessible from anywhere in the world for a virtual workforce.
• Big Data: Metrics and in-depth analysis of processes and people will become increasingly important in human resources as they are in other functional areas. Data- driven decision making is the future, as are metrics to show ROI in people and technology.  
• Security Issues: All this new technology brings up security concerns for employers and employee. Data breaches are a fact of life, and the threat to personal data security, company security, and supply chain risks will likely continue. 
• Health Care Costs: Costs are likely to continue increasing, since they have been rising steadily in the last several decades. New legislation will perhaps slow the costs of health care. In the meantime, strategies to lower employee healthcare costs will likely take the form of initiatives to improve employee health, and taking advantage of health reimbursement accounts (HRAs) that are consumer-driven or health savings accounts (HSAs).

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How to create a human resources plan

Benjamin Franklin is often quoted as saying, “If you fail to plan, you are planning to fail.” We can’t deny that there are few instances in life in which the result turns out better without preparation, especially when we’re talking about business. As a central component of any company, the HR department is no exception to this rule, meaning the human resources plan must be given the importance it deserves. 

If you’re still not sure what the purpose of human resources planning is , then this article is for you. We’ll explain in detail how to translate your department’s strategic thinking onto paper and put it into practice. 

What is s trategic human resource planning ?

The human resources plan outlines the general strategy for this business area . It includes measures to adapt to current and future supply and demand requirements relating to the workforce, as well as pay policies, wellbeing, etc. 

Generally, the document considers the following topics: 

• How many staff are required to fulfil the organisation’s needs . 
• Staff management strategies .
• Job descriptions for all posts.
• Channels and sources for attracting candidates.
• Recruitment and selection processes.
• Growth and development planning.

The importance of a human resources plan

A company human resources plan is essential if the staff and organisation are to operate effectively . This document is also key to achieving a company’s business objectives. 

It also serves to:

• Promote flexibility within the organisation : we are living in a constantly changing world. Effective planning helps companies adapt more easily to new situations and negotiate market volatility. 
• Improve the distribution and use of internal talent : by analysing and organising the human capital, companies can make better use of internal talent and distribute employees more coherently. 
• Facilitate growth for small to medium enterprises : HR planning is a fundamental aspect of growth strategies. It is important to know when to subcontract, how many people to hire, what benefits will it bring, etc.  

The objectives of a human resources plan

Why do companies design human resources management plans ? The main goals are as follows:  

• Supply information : the data acquired through a company’s human resources plan are hugely important to, for example, identify surplus, unused resources. Similarly, the information can also be used in other management functions.
• Analyse the current workforce : the document should also determine the workforce’s strengths and existing skills. 
• Use human resources effectively : Planning is the HR management’s primary responsibility, as their duty is to ensure efficient use of the current and future labour force. 
• Identify salary gaps : the document will also examine any potential salary gaps and, in turn, create more equal policies. 
• Ensure internal wellbeing : good planning and organisation almost automatically generate an improvement in the work environment, boosting productivity and employee satisfaction. 
• Retain talent : this, in turn, has a direct impact on talent retention. Employees who are content in their job are less likely to accept offers from other companies.
• Foresee potential department needs : all planning should include a forecasting section. Understanding when it will be necessary to incorporate new people into the team and what type of role is required is essential. 

6 steps to create a human resources plan

At this point you may be thinking, “but how do I do a human resources plan ?” If that’s the case, here are the steps you need to follow:

1. Define the plan’s objective

Any measures that are developed by a company must be aligned with the general business objectives. This goes for the human resources plan, too.  

Aside from this, the specific objectives of the plan will be targeted at a particular area: employee retention, attracting talent, promoting the business culture, etc. It is important to be clear and precise at this stage for the content to be useful and have a real impact on the organisation. 

2. Analyse the current human capital

The next key step is to analyse and evaluate the availability and resilience of the current resources. This will entail carrying out an exhaustive assessment of each member of the organisation in terms of skills, experience, performance, seniority, etc. 

3. Carry out a needs forecast

Analysing future labour requirements is an important step in human resources planning. Although there will always be fluctuations, it is critical to have a forecast in place of factors such as: redundancies, dismissals, retirements, promotions, etc.

4. Write the HR plan

Once you’ve gathered all the information, it’s time to create a solid plan that fulfils current needs and forecasted possibilities. For example, you will have to decide whether it is necessary to hire, train or subcontract labour to achieve the company’s objectives. 

In general, try to include the following information: 

• Definition of targets and goals.
• Required measures, expected results and resources used. 

5. Implement the plan 

Implementing the plan is probably the most challenging step. Many organisations, in fact, do not achieve what they have set out to do. To approach it successfully, trust your team and introduce changes gradually. Try to handle any incidents as they come along and make sure you are complying with the organisation’s general standards. 

6. Monitor and review the process

HR planning is an ongoing process. It is important to review the plan periodically to make sure the strategy is pointing in the right direction and achieving the objectives.

How to Succeed with Human Resource Planning: A Step-By-Step Guide (+11 Free Templates)

“ The term planning is imbecilic; everything can change tomorrow. “

That was a quote made by a French manager , straight after the 1973 oil crisis.

He’s right, of course. Everything can change tomorrow. We’re living in a world where we see changes every day. Ground-breaking technology, product innovations, and medical breakthroughs.

But does that mean “ planning is imbecilic ” though?

The truth is that planning can be ineffective and damaging if it’s done badly.

Good planning, on the other hand, can minimize the uncertainty brought on by change.

Don’t believe me?

Take the 1911 race to the South Pole, for example. The race was between two explorers: Roald Amundsen and Robert Falcon Scott. They each had a similar amount of experience and were the same age. Both faced 1,400 miles of gale-force winds, blizzards, and minus temperatures on their expeditions.

Amundsen meticulously planned his trip for several years. Scott didn’t.

Guess which expedition tragically failed?

Amundsen was already sailing back to Norway when Scott’s team finally gave up hope.

So, now we’ve established that planning is sensible, and not ‘ imbecilic ’, let’s find out why human resource planning is one of the most valuable processes a company can follow.

To do this, I’ll cover:

What is human resource planning?

Why is human resource planning important, the 7 steps of human resource planning, how human resource planning is done, human resource planning in hrm.

Let’s get on with helping you to plan for success!

Corporate leaders often say employees are their most valuable asset . In fact, employees are so valuable that over 23% of businesses fail because they don’t have the right team.

That’s why investing in Human Resource Planning (HRP) is one of the most important decisions a company can make. It’s also why 80% of companies do HRP on a regular basis.

In simple terms, HRP is a process that manages employees within an organization .

No organization can afford the risk of a critical skills shortage and without HRP, companies face expensive losses. This can be seen with 90% of the UK’s larger organizations , which have all restructured in the last five years – nearly always involving job losses.

“ Human resource planning is the most important component of the entire human resource system. ” –  Dr. Rajendra Mishra

We’ve established what human resource planning is, let’s talk about why it’s important.

The success of a business is directly linked to the performance of those who work for that business. It’s therefore critical to make sure that the business has the skills and competencies that it needs to succeed.

The quality of human resources in an organization is solely dependent on the success of human resource planning.

Look at Starbucks.

Starbucks has the lowest employee turnover rate among quick-service restaurants. Most quick-serve restaurants have between a 150 to 400% turnover rate. Starbucks’ rate is at 65% , and it’s all down to their human resources planning approach.

Not only will its low turnover rate positively affect the culture, motivation, and morale of its staff , but it will also massively help its profit margins.

On average, companies spend 33% of an employee’s annual salary to replace them when they leave.

We know that human resource planning is a continuous process of planning ahead to make optimum use of an organization’s most valuable asset: its employees .

We also know that the process helps companies maintain a steady supply of skilled employees to meet their strategic objectives.

So we know what human resource planning is and why it’s important, now let’s look at how to do it.

There are seven steps to a good human resource planning process:

• Understand business goals
• Assess the current workforce
• Forecast demand
• Estimate gaps
• Formulate a plan
• Implement the plan
• Monitor the plan

Let’s dive into the detail of each step.

Step 1: Understand business goals

The first step in HRP involves analyzing the organizational strategy, goals, and objectives.

It’s important to understand where the organization wants to go and how it wants to get there so that HR practices can be aligned with the company’s strategic objectives .

Step 2: Assess the current workforce

The next step is to take stock of the current employees in the organization to see if they fit the organizational needs.

The inventory of current employees should capture data concerning ages, locations, capabilities, and skills. This will determine what jobs are required and if you can use internal candidates or if you need to look elsewhere.

Step 3: Forecast demand

The third step in the process is to forecast future staffing needs based on the company goals.

This process will establish if the company needs to grow its workforce , or if it can improve its current staff through training.

Step 4: Estimate gaps

Once the future resource needs and the current capability of the workforce have been identified, step four requires you to highlight the gaps between the two .

These questions will help you find out where the gaps are:

• Do you foresee a skill shortage in a specific occupational group?
• Will changes in program delivery require the acquisition of new skills?
• Do you have succession plans for critical positions?
• Have you conducted a risk analysis of the elements of the scan critical to the success of your organization?

Step 5: Formulate a plan

Step 5 is all about formulating a plan to close the gaps you found in step 4.

The plan should identify the skill shortages and surpluses within the company. It should determine HR priorities and list actions to be taken around recruitment, training, internal role transitions, retirements, and lay-offs.

Step 6: Implement the plan

This step involves integrating the HR plan into the company . It will require support from different departments and teams.

Step 7: Monitor the plan

This step often gets missed, but is a fundamental part of the HR planning process.

Ongoing measurement, reporting, and continuous improvement will keep the company moving toward its strategic goals. If everything is running smoothly, continue with the plan . If there are roadblocks, change the plan to suit your company’s needs.

And there you have it. Seven steps to the efficient management of human resources in an organization.

What’s next?

Lucky for you, this isn’t where your human resource planning journey ends.

Process Street has created  eleven super-powered checklists to help you with your human resource planning:

• Training plan template

Employee evaluation form

Employee transition plan.

• Gap analysis template

HR strategic plan

• Employee satisfaction survey

Workforce planning template

Employee development plan template, hipaa compliance checklist for hr, vacation request form, business needs assessment checklist.

These templates will enable you to:

• Analyze your current workforce;
• Establish future workforce requirements;
• Formulate, implement, and monitor a formidable human resource plan.

Use the following Process Street templates to really smash your human resource planning!

Training plan

The training plan aims to improve workforce competency to increase productivity and reach organizational goals. Preparing an annual, company-wide training plan is a detailed and complex process .

Our training plan template will make it easy for you. It will identify who needs to be trained, when they should be trained, and what they need to be trained in. It also ensures alignment with your organizational goals.

Click here to access our training plan template!

Employee evaluations exist to make sure there is clear communication between employers and employees about performance levels. The process boosts morale and identifies areas of weakness.  These can inform your HR strategy, gap analysis, and training plans.

Use this employee evaluation form to:

• Capture performance metrics;
• Analyze your workforce;
• Make decisions about what future resources are needed.

Click here to access our employee evaluation form!

Performance review

We also have this performance review template which you can use as an alternative.

Click here to access this performance review template!

This process is for the HR team to ensure that a transitioning employee moves into their new role, smoothly and at a minimal cost to the business. It’s important the employee, their current line manager and their new line manager are all clear about the transition arrangements.

Our employee transition plan will provide guidance on handover and orientation tasks. It will also minimize disruption and uncertainty for employees affected by the change.

Click here to access our employee transition plan!

Gap analysis

Gap analysis involves you considering current skills in your workforce. As times change, skills will change to suit the modern business market. The below template gives you the foresight to keep your team and company up to date with current skill trends.

Use this gap analysis template to help your organization plan for growth. Use it to project the hiring needs for your future workforce. It can also help you to understand the skills and experience of your current workforce. You can also use it to develop strategies for overcoming the gap between the two.

Click here to access our gap analysis template!

An HR strategic plan is a tool to help businesses align their HR capabilities with their organizational goals . It establishes how human resources can make a direct impact on a company’s growth.

Our HR strategic plan will assess the needs of your organization. It can help to determine appropriate initiatives for the HR department to pursue and support the business in meeting its goals.

Click here to access our HR strategic plan!

Employee satisfaction

An employee satisfaction survey is intended to understand how employees are feeling about the company.

Our employee satisfaction survey will help you understand the current dynamics of the workplace. Once completed, it will identify areas within the business that need to be improved to keep your employees satisfied.

Click here to access our employee satisfaction survey!

Workforce planning ensures that a business has the right staff in place with the right skill sets.

Our workforce planning template will highlight areas within the workforce that need attention .

Click here to access our workforce planning template!

The employee development plan template will help your employees improve in their current job. It will also help them acquire knowledge and skills for new roles and responsibilities within the organization.

Click here to access our employee development plan template!

HIPAA is a series of regulatory standards that health care organizations must implement in their business to protect the privacy, security, and integrity of protected health information .

The compliance program that healthcare organizations need to follow is complicated and can take a long time to complete. Use our HIPAA compliance checklist for HR to make sure you don’t miss any vital steps.

Click here to access our HIPAA compliance checklist for HR!

You can also use this HIPAA compliance checklist , which is specifically for hospitals.

Run this checklist to determine how compliant your hospital is with HIPAA standards and regulations.

Click here to access our HIPAA compliance checklist!

Our vacation request form is designed to make sure that the company doesn’t suffer as a result of the employee’s holiday .

Using this checklist, a line manager can approve or reject a holiday request and HR can keep track of the number of holiday days an employee has taken.

Click here to access our vacation request form!

Or, try this other holiday leave application form .

Click here to access our holiday leave application form!

Use our business needs assessment checklist to:

• Determine priorities;
• Make improvements;
• Allocate resources.

Click here to access our business needs assessment checklist!

So you’ve done your HR planning, now you need to put your plans into action.

We have thousands of HR-related articles and functional checklists to help you implement your HR plans. From refining recruitment processes, and interview techniques, building a strong work culture, and improving employee engagement.

Take a look at this list of insightful gems:

• The Essential Processes Your HR Team Needs Today (+60 Free Templates)
• 12 HR Management Tips to Run an Effective Business (and Prevent Total Chaos)
• A Beginner’s Guide to Setting up HR Software in the Cloud
• How to Choose the Best HRIS (Human Resources Information System)
• Why HRMS is Becoming a Must-Have & How to Get Started

And there we have it. Your complete guide to planning for success with human resource planning!

We’d love to hear what you think about human resource planning in the comments. Who knows? You may even get featured in an upcoming article!

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Amanda Greenwood

Amanda is a content writer for Process Street. Her main mission in life is to write content that makes business processes fun, interesting, and easy to understand. Her background is in marketing and project management, so she has a wealth of experience to draw from, which adds a touch of reality and a whole heap of depth to the content she writes.

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How to Write a Human Resource Plan

If your business is to succeed and grow, you need to ensure that you dedicate the time and effort required to develop a comprehensive human resources strategy. An important component of any successful human resources strategy is writing a detailed human resource plan.

If you are unsure how to write a human resource plan or unclear about the difference between human resource planning and a human resources strategy, you have come to the right place!

We start by clearly explaining what the difference is between HR planning and an HR strategy. From there, we describe how a business plan fits in with your overall business strategy and outline the items you should address when you write your own human resource plan.

What is the Difference Between an HR Strategy and an HR Plan?

A Human Resource Strategy: A human resource strategy outlines the long-term direction of a business and how it will achieve those aims from a human resources perspective. It takes the long-term goals of that business and ensures that the business’s human resources are moving in the appropriate direction to achieve those same goals.

A proper human resources strategy addresses talent retention and acquisition, as well as the hierarchy for that organization, succession planning, and how your existing employees will progress through it. Your strategic human resource planning should outline how your business will react to industry changes appropriately. Every business must align its overarching goals with its human resource strategy to succeed and grow.

A Human Resource Plan: Once a business has developed an overarching human resources strategy, it will need to write a human resources plan. Essentially, this document breaks down the various tasks and initiatives required to follow its human resources strategy.

The Difference: Your human resource strategy is your overarching HR goals and aims. It explains how your business aligns its HR efforts to succeed overall. On the other hand, the human resource plan is a document that lists the tasks and initiatives required to achieve the human resources strategy. It also outlines how to link the human resources strategy together with your business strategy.

Simply put, your human resource plan is a document that you will follow to make the goals set out in your human resource strategy a reality.

How Do You Develop a Human Resource Plan?

After completing a human resources strategy, it is time to write up a document that outlines how your business will follow that strategy and stick to its goals.

The following are some of the areas your human resource plan should cover:

• A detailed description of how your business will achieve the objectives outlined in your human resources strategy. This section of your human resources plan should come first. It needs to be a specific action plan that will list timelines for certain goals and objectives. You also need to include accurate budget requirements in this section of your human resources plan. If your funding does not line up with the aims of your human resources strategy, it is unlikely that it will succeed. For example, if an organizational goal of your strategic HR plan is to acquire new talent who will stay with the business long-term, your strategic objectives should address how to attract the workforce you want to hire. How will you advertise new positions, and what can you offer qualified applicants that your competitors cannot?
• How to react to the growth of the business from a human resources perspective. When you acquire a greater number of clients or customers, how will your business react? Will you hire new employees to handle the increasing workload, or will you work towards automation and upskilling your current workforce so they can handle more responsibility?
• A thorough breakdown of your business’s current capabilities, as well as a detailed forecast of your anticipated needs. What skills do your current employees possess, and what skills do you anticipate needing in the future?
• Detailed descriptions of how your business will go about acquiring new talent. This plan should give a thorough breakdown of the company’s compensation structure, its training and development system, performance appraisal, and performance management. Remember, you will not be able to hire the new talent to keep up with demand if your human resources plan is vague and incomplete. Human resources planning should also outline what you are looking for from new hires, including what traits they should have to fit into your business’s existing work culture. Recent labour shortages have made acquiring new talent more difficult than ever before. Your human resources plan should clearly state what you are looking for from new employees and how you will position yourself as an attractive employer to desirable candidates. Employee retention is also critical! Human resource planning should outline initiatives you will follow to retain the current talent you employ.
• Detailed descriptions of potential contingencies for when things do not go according to plan. Will your business be able to fulfil its payroll responsibilities during periods of hardship, or will you have to turn to external funding and layoffs? Do you have a strategic plan for outsourcing or contracting out some of the current or future roles your business needs to fill?

Final Words

The actual format your human resource plan follows does not have to be overly specific, but it is important that it is detailed and realistically describes how you will achieve the goals described within your human resources strategy.

For your business to succeed, you must consider human resources planning for every decision you make. Remember that human resource plans need to be updated regularly. While this plan should be comprehensive, you cannot be afraid to revisit it as your business grows and the market changes.

Once it is written, refer to your human resource plan regularly, as it will help ensure that your business is always moving in the right direction.

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People Management

Human resource planning (hrp): a guide for hr professionals.

March 21, 2024

In the business world of sameness, your employees are your true differentiator.

And that’s where HR teams come in—meticulously planning every step of the employee lifecycle to ensure your business’ success. Whether you’re a seasoned HR professional or a new member of an HR team, brush up on the must-haves for optimal human resource planning (HPR).

What Is Human Resource Planning?

Understanding human resource planning, steps to effective human resource planning, the role of hrp in boosting organizational performance, challenges of human resource planning, utilizing technology in human resource planning, future trends in human resource planning.

Companies need to ensure their human resource goals match their business goals. Businesses use human resource planning to evaluate their current workforce and predict its alignment with future needs.

In this process, you and the rest of your HR team identify skill requirements and formulate recruitment, training, management, and succession planning. Meticulously planning for future needs enables companies to optimize staffing levels while staying prepared for upcoming challenges and opportunities.

Human resource planning is often the unsung hero in a company’s strategic framework—the behind-the-scenes MVP deserves a closer look.

HR planning must align human resources with the broader organizational strategy and business goals to be effective. To do this, the HR planning process must be comprehensive, accurately assessing current employees and forecasting future needs so that any gaps can be filled at the appropriate time.

Different roles of human resource planning

Because a strategic human resource plan aligns with organizational goals, it encompasses everything from workforce planning to employee retention. To fully appreciate the benefits of HR planning, let’s zoom in and see the different hats it wears in a company.

The most obvious role human resource planning plays is in determining how many employees are necessary for the company to operate. To do this, HRP must also rely heavily on performance management, where past reviews are assessed to understand the current workforce’s strengths and weaknesses. Employee self-evaluations can be helpful in this regard.

Next, human resource planning plays a critical role in gap analysis. It lets companies know when and where they lack specific skills, not only for the present but also for future needs. Through this gap analysis, a business can more effectively plan for training current employees and hiring new employees.

“Hard” vs. “soft” human resource planning

There are two approaches to HRP: “Hard” and “soft.”

In “hard” human resource planning, a quantitative approach is taken. The focus is on workforce capabilities and resource planning. Supply forecasting and skills inventory data is used to predict future workforce requirements. 

The sole mission is getting that sweet alignment between human resources and the business’s needs.

“Soft” human resource planning flips the script, prioritizing the qualitative side of the process. It’s all about company culture, employee satisfaction, and fine-tuning those essential soft skills. 

Soft HRP aims to create a supportive work environment that fosters employee retention while aligning with organizational objectives. It’s accomplished through employee training programs, building skilled employees from within who can meet the organization’s strategy.

To understand the process more deeply, let’s break down the key steps of human resource planning and unlock its secrets.

Analyzing organizational objectives and plans

The HR planning process must align with the overall business strategy for human resource planning to be effective. The organization must carefully lay out its long-term goals so the human resource department has a roadmap.

HR professionals must work closely with department leads to understand the business objectives comprehensively. Only through this collaboration can the human resource plan strategically align with where the company wants to go.

Evaluating the current state of the workforce and uncovering gaps

The current workforce status must be assessed in the second step of the HR planning process. This involves a detailed analysis of their skills, capabilities, and performance, vividly showing the team’s strengths and areas for improvement.

HR teams use tools like performance management systems to build a comprehensive skills inventory. Try conducting employee self-evaluations to get a broader picture of where gaps may be.

The next steps hinge on how effectively the current employees align with the present and future needs of the business.

Forecasting future HR requirements

Once the HR manager knows the company’s future goals and the workforce’s current state, they can begin forecasting future HR requirements. They’ll use the data to predict the need for new employees.

This is a complex process—changes to the business environment, company culture, and market trends must all be considered to forecast future demand accurately. As markets shift, the pool of available quality employees changes, too. Supply forecasting helps HR human resource planners factor this in and initiate the hiring process at an optimal time.

Developing and implementing a plan

Now that we understand the the gaps between current staffing and future needs, let’s move on to developing and implementing a strategic HR plan. 

The HR team should create talent strategies for recruiting and retaining new hires while developing the skills of existing employees to keep pace with changing business needs. Creating detailed job descriptions, refining the hiring process, and planning for benefits administration are vital during this step.

Monitoring, reviewing, and reassessing the plan

The final step is more of an ongoing HRP process. The team must continually monitor and reassess the needs of the company. 

HR software and analytics tools help track the effectiveness of human resource planning over time. Continuously monitoring employee performance and the impact of training programs ensures that strategic human resource management stays aligned with the changing business environment.

A company’s performance depends heavily on how well-staffed it is. It isn’t just about the number of employees on the payroll but how well those employees meet the organization’s needs. The human resource planning process is the best way to ensure that alignment.

Strategic human resource planning effectively identifies the number of employees required, their needed skills, and the optimal hiring times to maximize the chances of securing qualified individuals when they’re needed.

HR professionals identify gaps in the ability of current employees as they go through the HRP process. These gaps degrade the overall performance of the business. A good human resource plan will weigh the ability to train the existing workforce to meet demand vs. the need to hire new employees.

Because HR managers must work closely with department heads for this alignment to occur, they’re always acutely aware of where performance issues are arising and can adapt the planning process to mitigate those problems.

Another area where HRP can boost a company’s performance is by facilitating organizational innovation. A business must have a skilled and dynamic employee pool to be innovative. With a well-developed HR plan, the company can identify potential employees who can fulfill those needs.

While the human resource planning process is vital to organizational management, it doesn’t come without challenges. Without a plan to overcome these challenges, they can derail the plan’s effectiveness.  Strategic planning must anticipate the challenges an HR team will encounter during HRP, ranging from market fluctuations to internal workforce dynamics.

Business objective alignment

We’ve talked quite a bit about the need to balance a human resource strategy with the objectives of the business. This, essentially, is the core of HRP and one of the biggest challenges HR managers face when developing a plan. The ever-evolving market conditions and organizational priorities add a layer of complexity to the already challenging task of strategic human resource planning.

To counter this, HR departments must maintain a continuous approach to HRP and constantly consult with department heads to update the direction of the company and the needs of individual departments.

Accurate forecasting

A big part of human resource planning involves forecasting the demand for current employees and future talent. Business growth can be unpredictable, technological advancements can change needs rapidly, and economic changes can shift priorities.

Investing in HR software such as data analytics and forecasting tools will help HR plan more accurately for these changes. These tools used advanced machine learning and large amounts of data to create forecasts more accurately than humans alone can.

Maintaining balance

There’s a delicate balance to be maintained between the current workforce needs and future requirements. This planning process can be overwhelming, especially for small HR teams. Teams at larger companies may struggle to stay connected with the needs of frontline employees.

Smaller teams especially must rely on talent management software that will automate much of the work in predicting when new employees or skills will be needed. Larger companies must create and maintain a direct line of communication between HR and frontline employees so their concerns are always a part of the human resource planning process.

Integrating the planning processes

Human resource planning must not only consider the business’s goals but must be tightly integrated with the company’s overall planning process. This ensures that actions taken by HR aren’t just reactive but that a proactive approach to hiring and training employees is taken.

This requires a strategic approach to resource planning. HR managers should be a part of every discussion about the company’s future so they can provide input that shapes the company’s direction and receive input that shapes HR’s approach. 

We’ve seen several instances where HR planning software will help teams better prepare for the business’s staffing needs. Technology has evolved rapidly in recent years, making it a vital part of strategic human resources planning. Chief among these advancements has been the growth of artificial intelligence , revolutionizing how companies manage their workforce through machine learning.

The rise of remote work has further driven the adoption of new technologies. An HR department must emphasize a flexible and dynamic human resource planning process with a dispersed workforce. Innovative tools and workforce planning software can help support these growing HR needs.

ClickUp is an all-in-one productivity platform. In addition to comprehensive project planning tools , the software has useful features for human resources planning. Its capabilities extend to various HR functions but also work well for every department in the company, making it ideally suited to keeping HR departments on the same page as other departments and the overall company direction.

As you can tell, it’s obvious how vital performance management is for strategic human resource planning. ClickUp provides a robust set of performance management tools, helping HR staff give and receive continuous feedback and set employee goals. By taking advantage of these features, your company can foster a constant learning and development culture that better prepares it for changing needs.

One of ClickUp’s biggest strengths is the extensive set of available templates. For nearly any productivity task your company needs to accomplish, a template shows you exactly how to put the software’s features to work on it.

 ClickUp’s HR Standard Operating Procedures template is handy for identifying skill gaps and developing a plan to close them. To keep existing employees up-to-date and prepared for changing requirements, the ClickUp HR knowledge base template shines.  

Technology has rapidly changed the landscape of human resources and shows no signs of slowing down. Changing attitudes and shifting priorities will also affect how strategic human resource planning evolves over the coming years.

Companies will no doubt find that artificial intelligence and data analytics tools will emerge that further refine processes and increase the accuracy of forecasts. As these tools improve the ability of an HR team to forecast staffing needs and identify skill gaps, smaller HR teams will be able to better compete with their larger counterparts.

We’re also seeing significant shifts in the way companies approach employment. More focus than ever is being placed on employee well-being and work-life balance. These priorities pay dividends by reducing burnout and improving productivity. 

Human resources departments will increasingly shift from mere recruitment and training to working on building an inclusive and supportive workplace culture. 

The trend of remote work and the gig economy will likely continue. The gig economy could provide opportunities for HR teams to rely on independent contractors for temporary surges in staffing requirements to keep the in-house staffing optimized during slow times but not overwhelmed during the busy ones.

Wrapping It Up

While many challenges are involved in keeping a company’s workforce as tightly tuned to its actual needs as possible, doing so provides the most efficient use of human resources and a substantial competitive advantage.

Thankfully, there are many tools available to help companies achieve this. Several free HR planning templates can help keep your staff organized and their processes streamlined. By combining this with effective employee management software , like ClickUp, even small teams can develop comprehensive human resource plans.

ClickUp is free to try. Sign up today to see how this powerful productivity tool can benefit your company.

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HR Business Plan: What Is It And What Are Its Steps?

Every company that has an HR department needs an HR business plan. Without it, you will have inconsistencies when you deal with your employees.

Human resources manage the relationship between your company and its employees. Due to this, it is only natural for human resources to have their own plan of approach to their tasks.

Key Takeaways:

An HR business plan is the strategic approach of the human resources department.

The HR business plan should clarify responsibilities, organize its processes, and create performance standards in which to gauge its success.

First assess the current HR situation, then establish goals and strategies to enact those goals for the HR department.

Make sure your HR strategies comply with legal requirements.

What Is A HR Business Plan?

An HR business plan is a strategic approach your human resource department will follow to accomplish its goals.

Like all business plans, an HR business plan needs to define its objectives, organize systems of measured success, and incorporate a flexible framework. A robust plan can adapt to new scenarios and still focus on its long-term aims.

Though this will vary by company, in general, every HR business plan will want to:

Clarify roles and responsibilities. Focus on the roles and responsibilities of the department and its members. You want to understand the job descriptions of each member of the human resource department. Then decide what the overall purpose of the department is and connect it back to each member. Be aware of any conflicting or contradictory agendas and seek to streamline.

Design and organize processes. Human resources helps hire, train, onboard, and terminate staff. There should be well-detailed plans for each process that keeps the human resources department prepared for any scenario.

Address compensation and benefits. Human resources manages the implementation of benefits and compensation. Therefore, the department’s plan must discuss how this will be handled.

Comply with legal requirements. The human resource department needs to be well-versed in the legal requirements and protections of the employees. The plan should provide a clear compliance with the law.

Create performance standards. A business plan is useless unless it can be evaluated against measures of success. It helps to provide metrics with results to be more objective in analysis.

Tie in to overall business plan. The HR business plan needs to complement the overarching business plan of the company. Avoid any policies or procedures that conflict with the overall business plan.

A human resource business plan will develop these points into a coherent strategy.

Steps To Develop A HR Business Plan

Assess current human resource situation. Before a plan is made, the human resources department and the company executives need to know what they have already. Your company should evaluate the roles and responsibilities of its human resource staff. You will want to see if anything is missing or if there is anything that is expendable.

Establish goals for human resource department. Now that you know what you’re working with, it is time now to think about what you want the human resource department to accomplish. Use the roles and responsibilities you just clarified to arrange practical benchmarks you want the department to make. Make sure goals do not interfere with one another but build toward an overall objective.

Create strategies to enact goals. Once you have your goals in place, it is time to build strategies to accomplish those goals. These strategies should work in tandem, so make sure each one has a logical progression. Like the goals, you do not want your strategies to interfere with one another but instead build towards an overall objective.

Evaluate business plan. Once you enact the plan, you need to make sure you accomplish your goals. Have a feedback system put in place where you can measure the success and failures of your plan. Come up with contingency plans in case your initial plans need to be re-evaluated.

Why Have A Human Resource Business Plan

An HR business plan is needed to establish long-term success with your employees.

Your plan gives focuses on the roles and responsibilities of the department. Human resources play a critical role in the hiring, training, and retention of staff. A business plan will clarify these procedures.

A HR business plan also provides consistency in the implementation of benefits and managing the welfare of the employees.

The human resource business plan empowers the department to perform at its best. In turn, it will help employees be equipped and compensated to perform at their best.

Without a HR business plan, your company is at risk conflicted and contradictory procedures that impede growth and success.

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Conor McMahon is a writer for Zippia, with previous experience in the nonprofit, customer service, and technical support industries. He has a degree in Music Industry from Northeastern University and in his free time he plays guitar with his friends. Conor enjoys creative writing between his work doing professional content creation and technical documentation.

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Download : Free HR Business Plan Template

Every success story starts with a plan. Using this template, you can help flesh out a business plan for your HR function with: 

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Prepare Your Annual HR Plan for 2024

Each year, it is important to create an annual HR plan to guide your people team or human resources department. However, in 2024, it is even more important for HR departments to take into account recent changes , and develop a sound hr strategic plan to take their teams to the next level.

More important than the details of the plan itself is to make sure the company’s mission and vision are reflected within your annual HR plan for 2024. Without clear objectives and a path to achieve them, you may fall short in reaching your company’s goals.

A highly focused and clearly communicated annual HR plan helps to guarantee your HR objectives will be met.

In this article, we will cover the ins and outs of yearly HR planning and provide the key steps to reach your HR goals.

Table of Contents

What is Meant by HR Planning ?

The purpose of a human resources plan is to analyze and evaluate all the elements related to the human resources policy for the coming year.

Everything from staff dynamics, organizational structure , and working conditions to the hiring process and onboarding of new employees .

As there are many aspects of an HR annual work plan, it’s important to first understand the company environment within which you work, as this will greatly affect the HR plan you create. Once you evaluate the company environment, you can then move forward with creating a successful HR plan of action.

Prepare your annual business plan for HR in 2024 and reach all of your objectives.

Map Out Your Annual HR Plan: Evaluate the Company Environment

At the beginning of the year, companies establish a strategic plan, dependent heavily on the human resources department, where the key annual objectives are set.  In order to develop a successful annual HR plan, it’s important to take into consideration the company’s policies and procedures , as well as the employee handbook . That way, you can rest assured that the goals and plans of the company are aligned with those of HR.

To reach your HR objectives, you must first know the answers to the following questions:

What Can We Improve on From Last Year’s Annual HR Planning?

Success is simply the result of many failures and tried attempts, all put together. Identifying past struggles and using them as fuel to propel you forward is what leads to success and improvement.

What Expected Challenges Can I Include in My Yearly HR Plan?

When you know what’s coming, you can better adapt and take advantage of the changes, rather than let them take advantage of you. Consider learning about change management techniques to stay in control through the ups and downs. Analyzing the potential challenges is fundamental for preparing your team for what’s ahead. Also, knowing which changes, events and activities are taking place in the coming months, and how they will likely influence your team, allows you to better manage what lies ahead.

What Areas Within the Company Should I Plan to Improve?

Constant evaluation of the state of the company and its staff is crucial to coming up with solutions to improve. With Factorial, for example, you can create human resources reports that display a graphical vision of the company, outlining the required areas of improvement. If used correctly, these charts can also allow you to make visual conclusions about things such as the turnover rate or employee motivation.

Identifying key areas of improvement is one of the stepping stones to a successful large or small business HR plan.

As a result, reaching your yearly objectives is easy when you take the proper steps to first analyze the company’s environment and what you are working with . Clear communication between the human resources department and the company’s management is vital to creating a solid base for your annual human resources plan.

Define Your Annual HR Plan Goals & Objectives

The objectives of the company’s strategic plan are called long-term objectives . These types of objectives help measure the reach and success of the human resources plan.  Generally speaking, they can be divided into two categories:

• Explicit Objectives : Focus on attracting and retaining talent, employee motivation, and improving employee engagement. To set explicit objectives in your annual HR operating plan you have to consider employee experience, the onboarding process, career plans, etc.
• Implicit Objectives: Follow the company’s philosophy and help form the company culture. They show the power of the HR department and how it can help improve productivity. In addition, these objectives focus on the work environment and quality of life for the employees while maintaining all labor regulations.

Organize Your Annual HR Planning: Set Team Responsibilities

Once the objectives are clear, both for the company and for the human resources department, it’s time to create your HR plan by reviewing the team responsibilities. Keep in mind, a thorough analysis of what each department will do in order to contribute to achieving the 2024 HR goals is necessary before moving forward.

Following this, the first step in the HR action plan 2024, is to assign a person who will be in charge of creating and implementing the HR plan . For smaller companies, this person will probably be the CEO. In slightly larger businesses, the person responsible is normally the same one who handles all of the human resources-related tasks. Medium-sized companies will look to their HR team; with every member delegated to a specific task, each corresponding with a goal.

Human resources organizational charts are a great way to visually see who is responsible for what, and who reports to who in the company. Using this type of chart is incredibly helpful for your staff planning.  They can be also useful to ensure that the HR management to HR employee ratio is in check. Try using a free organizational chart template to have a clear picture of your company’s structure.

These charts are great for displaying the following:

• The structural hierarchy of the company : Directors, managers, intermediate profiles, employees, etc.
• The departments within the company : Marketing, sales, product, human resources, etc.
• Positions to fill : If there are any gaps in the company structure, the organizational chart will make them clear.

Annual HR Staff Planning: Identify Open Positions

Thanks to the organizational chart you can clearly see how many people you need to hire and for which positions. If you want to achieve your objectives for the coming year, you’ll need to have the right team in place.

In your HR plan you will define:

• Which positions are open – Write a detailed description of all the positions to be filled, including the corresponding department, responsibilities, functions, where they fit in the hierarchy, and their workload.
• Define the ideal profile – Here you’ll have to specify the profile of the candidate you are interested in hiring. Clearly outline the level of education you are looking for, the experience level, and the skills required. Based on this, you can decide whether to recruit from within the company if there is an employee that fits the desired profile.

Clearly defining the above details, are important steps to take in your HR plan. Therefore, allow yourself the time to study and analyze your company at each stage of the HR plan creation process.

Start Planning with a Defined HR Policy

Your updated human resources policy must meet the standards and demands of the general HR and strategic plan. The hr policy will also include guides for the HR department, including, but not limited to:

Hiring Guide

The main purpose of the hiring guide is to assist the HR manager in hiring and onboarding. This guide serves to outline the roles and responsibilities of the employees you are looking to hire. It should contain information on the types of contracts for each position as well. Also, including an HR annual training plan template in your hiring guide is beneficial.

Note: As an HR manager, you will need to decide whether the hiring process will be outsourced or handled within the company. If hiring is done from inside the company , a strategic onboarding process must be established to ensure successful recruitment and retention.

Compensation Guide

With every new contract you plan on offering, you need to state the details of each. For example, the salary amount, benefits, and economic bonuses. Make sure that what is offered in your compensation guide is in line with your overall Human Resources budget.

Workplace Satisfaction Guide Personal

Taking care of new hires is important, but don’t forget about your veteran employees. Long-term employees need to feel continually valued and supported as well. In your HR plan, you should invest part of your budget for the personal and professional development of each employee in the team.

Investing in employee wellbeing creates greater workplace satisfaction. Providing employees with the right personal development tools for success is key. Employees that feel supported display greater motivation for achieving their own goals and career aspirations.

Company Guide

Inside the HR policy, you should think about including a practical guide from the company. Contained in this guide, would be the company vision and mission, proper conduct guides, and conflict resolution codes

Build Your Annual HR Plan 2024

Now that you’ve gone through all the previous steps, you’re ready to build the best HR plan for 2024.

As you can see, creating the ideal HR plan for 2024 takes time and effort to compile . Unfortunately, a high percentage of small and medium-sized businesses simply don’t have the personnel to create a dynamic HR plan.

Save time creating your Annual HR plan with Factorial!

A solid HR plan is fundamental to achieving company goals. If you don’t have the correct tools to do the job, you’ll end up exhausting yourself creating a plan that will miss the mark in the end.

With Factorial, you can create your human resources plan for 2024 with ease. Build your organizational chart , fast and easy, and see who is in charge of what at a glance. Decide which departments need more assistance or restructuring.

Furthermore, Factorial gives you access to all kinds of human resources reports. These reports help you analyze the state of your company, allowing you to more effectively create the most successful HR plan for the coming year!

Are you looking for a little extra support to streamline your HR processes?

Simplify your HR processes with Factorial

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“Unfortunately, a high percentage of small and medium-sized businesses simply don’t have the personal to create a dynamic HR plan.”

‘personal’ should be ‘personnel’, unless I am mistaken?

A great article otherwise!

Thanks Trudy!

Post more! Seriously, I am really digging what you have written so far. I’ve scanned your blog right now for more things to read.

Thanks , this piece was indeed very useful.

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10+ SAMPLE HR Business Plan in PDF

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HR Consulting Business plan Template

Written by Dave Lavinsky

HR Consulting Business Plan

You’ve come to the right place to create your Human Resources Consulting business plan.

We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their HR Consulting businesses.

Below is a template to help you create each section of your Human Resource business plan.

Executive Summary

Business overview.

HR Solutions is a startup human resources company located in Spokane, Washington. The company is founded by Tremaine Jackson, a former human resources manager in a large retail company. Tremaine led a team of twenty human resources employees in overseeing all aspects of human resources for the employer and developed a unique application that he has decided to introduce in his new company, HR Solutions.

HR Solutions will be the comprehensive leader in human resource training, management, negotiations, and solutions-finding company in the state of Washington. They will provide everything human resource personnel need to hire and effectively onboard new employees, as well as everything needed to maintain proper records, effectively cover communication and employee relations, and become proactive about potential conflicts.

Product Offering

The following are the services that HR Solutions will provide:

• Proprietary app that creates comprehensive HR management plans
• Training to maximize personnel potential
• Assistance in compliance with laws and regulations
• Curated HR solutions to solve employee issues
• Assistance in establishing productive work environments
• Onboarding from A to Z
• “Support Cadre” for HR management personnel
• Recruitment and talent acquisition training
• Organizational process-and-procedure manual

Customer Focus

HR Solutions will target small-to-large businesses in the Spokane, Washington region. HR Solutions will also target Washington state with select online training programs and sales of the proprietary HR app. HR Solutions will target C-suite executives in Spokane.

Management Team

HR Solutions will be owned and operated by Tremaine Jackson. He recruited his former administrative assistant, Sharlene Harris, to be his Administrative Manager in HR Solutions, where she will provide oversight of all personnel and HR responsibilities within the company itself. He also recruited Mason Wright, a former associate and HR manager, to be the Senior HR Advisor within the startup; he will lead the other HR managers in their roles as client-focused solution providers.

Tremaine Jackson is a graduate of the University of Washington in Seattle, where he majored in Human Resource Development. He has been a human resources manager in a large retail company, where he led a team of twenty human resources employees in overseeing all aspects of human resources for his employer and he developed a unique application that he has decided to introduce in his new company, HR Solutions. Former clients and associates have indicated they will follow him when he establishes HR Solutions.

Sharlene Harris holds a bachelor’s degree in Business Administration from Spokane College. She has been Tremaine’s administrative assistant for ten years and her new role will be the Administrative Manager in HR Solutions. She will provide oversight of all personnel and HR responsibilities within the company itself.

Mason Wright, a former associate and HR manager, developed a large following of loyal clients. He will be the Senior HR Advisor within the startup; he will lead the other HR managers in their roles as client-focused solution providers. His clients have indicated that they will follow him into the startup business.

Success Factors

HR Solutions will be able to achieve success by offering the following competitive advantages:

• Friendly, knowledgeable, and highly-qualified team of HR Solutions

Financial Highlights

HR Solutions is seeking $200,000 in debt financing to launch HR Solutions. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and marketing costs. The breakout of the funding is below:

• Office space build-out: $20,000
• Office equipment, supplies, and materials: $10,000
• Three months of overhead expenses (payroll, rent, utilities): $150,000
• Marketing costs: $10,000
• Working capital: $10,000

The following graph outlines the financial projections for HR Solutions.

Company Overview

Who is hr solutions.

HR Solutions is a newly established, full-service human resource company in Spokane, Washington. HR Solutions will be the most reliable, cost-effective, and effective choice for HR managers and leaders in Spokane. Certain online programs and the proprietary app will also be the most effective and productive options for HR personnel throughout the state of Washington. HR Solutions will provide a comprehensive menu of training, recruitment, personnel, solution-finding services for any company to utilize. Their full-service approach includes a comprehensive set of training, management, and solution options.

  HR Solutions will be able to provide superior HR support and solutions to every business. The team of professionals are highly qualified and experienced in onboarding, training and creating solutions for every human resource quandary. HR Solutions removes all headaches and issues of the human resource personnel and ensures clients find the best answers to all their HR needs with the outstanding customer service found at HR Solutions.

HR Solutions History

HR Solutions is owned and operated by Tremaine Jackson. Tremaine Jackson is a graduate of the University of Washington in Seattle, where he majored in Human Resource Development. He has been a human resources manager in a large retail company, where he led a team of twenty human resources employees in overseeing all aspects of human resources for his employer and he developed a unique application that he has decided to introduce in his new company, HR Solutions. Former clients and associates have indicated they will follow him when he establishes HR Solutions.

Since incorporation, HR Solutions has achieved the following milestones:

• Registered HR Solutions, LLC to transact business in the state of Washington.
• Has a contract in place for a 20,000 square foot office space within a downtown Spokane building.
• Reached out to numerous former clients and contacts to include those who will refer and recommend HR Solutions.
• Began recruiting a staff of ten HR managers and three office personnel to work at HR Solutions.

HR Solutions Services

The following will be the services HR Solutions will provide:

Industry Analysis

The human resources industry is expected to grow during the next five years to over $35 billion. The growth will be driven by an increased number of young employees who require extensive training and onboarding. The growth will be driven by an increased need for employees as the older demographic employee retires. The growth will be driven by an increase in the number of employees who are new to the U.S. and require assistance in onboarding and training. The growth will be driven by new technological advances that are not yet known. Costs will likely be reduced as new applications, such as the one created by HR Solutions, are created and introduced into the industry.

Customer Analysis

Demographic profile of target market, customer segmentation.

HR Solutions will primarily target the following customer profiles:

• Small-to-large businesses in the Spokane region
• Small-to-large businesses throughout Washington (select programs/app)
• C-suite executives in Spokane

Competitive Analysis

Direct and indirect competitors.

HR Solutions will face competition from other companies with similar business profiles. A description of each competitor company is below.

Human Resource RX

Human Resource RX was founded in 2005 by Reme and Janette Choux. As former human resource negotiators within a large firm, they developed distinctive programs that can help HR managers reduce conflicts in the workplace. In addition, the programs assist personnel in recuperating from workplace trauma and other difficulties or issues that arise in the office.

Human Resource RX, headquartered in Spokane, claims to be the “Best HR Prescription” for companies that require assistance in the form of management and oversight in trauma or difficulty. Human Resource RX also assists in compliance issues within the state of Washington, bringing expert advice into thorny issues that can potentially lead to litigation. The company has three offices throughout Washington, each with a staff of twelve “HR managers” who service local businesses. The company has maintained a good standing within the state of Washington, although there have been two separate issues of incorrect legal advice offered to clients. The matters were both brought by former clients to the court system and eventually resolved.

Premier Human Resource Associates

Premier Human Resource Associates is owned and operated by Tami Watson, an HR executive with over thirty years of experience. She is joined in the company by her daughter, Reyna Watson, a recent graduate of Spokane College, where she earned a bachelor’s degree in Communication. Premier Human Resource Associates is located in Spokane and offers an extensive onboarding and training program to support HR managers within local hospitals and medical clinics.

The bulk of services provided to HR managers includes various specific onboarding and training needs of nurses, LVNs, and other care providers. Attention is given in particular to the processes of sanitation and hygienic practices, along with the methods of communication used within these specific businesses. To date, the company has assisted in successfully onboarding over 5,000 nurses and other caregivers.

Transport HR Training

Transport HR Training was started in 1997 as a result of multiple difficult issues within the truck driving industry in Washington. In the decades since, Transport HR Training has established the full spectrum of services and products for HR associates in the long-haul and short-transport businesses. Specific practices and procedures relating to, in particular, medical issues of drivers, have been developed to smooth the HR process and align truck drivers with services they need. Transport HR Training offers a comprehensive package of services that includes negotiation in conflict, onboarding specifics, driver training, legal procedures and processes, and other truck driver-specific conditions.

Competitive Advantage

HR Solutions will be able to offer the following advantages over their competition:

Marketing Plan

Brand & value proposition.

HR Solutions will offer the unique value proposition to its clientele:

Promotions Strategy

The promotions strategy for HR Solutions is as follows:

Word of Mouth/Referrals

HR Solutions has built up an extensive list of clients and contacts over the years by providing exceptional service and expertise to their clients. Associates will follow them to their new company and help spread the word of HR Solutions.

Professional Associations and Networking

HR Solutions will extensively network throughout HR association and industry events. They will take an active role in leadership wherever invited to do so and will work to support the efforts of all associates or members.

Website/SEO Marketing

HR Solutions will fully utilize their website. The website will be well organized, informative, and list all the services that HR Solutions provides. The website will also list their contact information and list their available times to make reservations during the week. This will allow HR managers to speak with HR Solutions when most beneficial to the client. The website presence will engage SEO marketing tactics so that anytime someone types in the Google or Bing search engine “Human Resources company” or “HR near me”, HR Solutions will be listed at the top of the search results.

The pricing of HR Solutions will be moderate and on par with competitors so customers feel they receive excellent value when purchasing their services.

Operations Plan

The following will be the operations plan for HR Solutions. Operation Functions:

• Tremaine Jackson will be the Owner and President of the company. He will oversee all staff and manage client relations. He has spent the past year recruiting the following staff:

Milestones:

HR Solutions will have the following milestones completed in the next six months.

• 5/1/202X – Finalize contract to lease office space
• 5/15/202X – Finalize personnel and staff employment contracts for the HR Solutions
• 6/1/202X – Finalize contracts for new HR Solutions clients
• 6/15/202X – Begin networking at industry events
• 6/22/202X – Begin moving into HR Solutions office
• 7/1/202X – HR Solutions opens its office for business

Financial Plan

Key revenue & costs.

The revenue drivers for HR Solutions are the fees they will charge to clients for their services, online training and proprietary app.

The cost drivers will be the overhead costs required in order to staff HR Solutions. The expenses will be the payroll cost, rent, utilities, office supplies, and marketing materials.

Funding Requirements and Use of Funds

HR Solutions is seeking $200,000 in debt financing to launch its human resources company. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and association memberships. The breakout of the funding is below:

Key Assumptions

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.

• Number of Clients Per Month: 40
• Average Revenue per Month: $80,000
• Office Lease per Year: $100,000

Financial Projections

Income statement, balance sheet, cash flow statement, human resource business plan faqs, what is a human resource business plan.

A human resource business plan is a plan to start and/or grow your human resource business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can easily complete your Human Resource business plan using our Human Resource Business Plan Template here .

What are the Main Types of Human Resource Businesses? 

There are a number of different kinds of human resource businesses , some examples include: Human Capital Strategy, Compensation & Benefits, Talent Management, and Professional Development.

How Do You Get Funding for Your Human Resource Business Plan?

Human Resource businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.

What are the Steps To Start a Human Resource Business?

Starting a human resource business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Human Resource Business Plan - The first step in starting a business is to create a detailed human resource business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast. 

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your human resource business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your human resource business is in compliance with local laws.

3. Register Your Human Resource Business - Once you have chosen a legal structure, the next step is to register your human resource business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.

4. Identify Financing Options - It’s likely that you’ll need some capital to start your human resource business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.

7. Acquire Necessary Human Resource Equipment & Supplies - In order to start your human resource business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your human resource business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

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Resource Planning For Your Business Plan

Identifying the resources you need to grow your business

Why Is Resource Planning Important

How to start resource planning, the bottom line, frequently asked questions (faqs).

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A business plan helps you organize your goals and growth plans for your business. Identifying business resources you'll be starting your business with already, and accounting for the resources you'll need to acquire after launching the business, is a crucial step in business planning.

Key Takeaways

• A business plan helps you organize your goals and growth plans for your business.
• Resource planning help you account for resources you have, plan for resources you need and ways to optimize their use
• You can plan for physical, people and technical resources in your business plan

Resource planning help you account for resources you have, plan for resources you need and ways to optimize their use. Among other things, even the most simple business plans are designed to walk you through the activity of describing every source and the exact dollar amount of your initial equity capital, as well as account for the equipment necessary to produce your products or services.

It can be difficult to accurately estimate your future resource needs, which is why this startup mistake is one of the most frequent contributors to young businesses running out of cash early on.

A very important section in your business plan is about the finances of your business, and that includes how much you hope to spend on resources you need to acquire and maintenance expenses on assets you own. Your plans for obtaining the necessary personnel, equipment, and cash to meet your capital expenses will need to be detailed throughout your business plan.

You may need financing from a bank or investors or will invest your personal savings in the business, and resource planning will come in handy for that too.

Resource allocation plans are what your potential investors and business partners are going to need to see before jumping on board with your new company.

There are different types of resources and you need to budget and plan for them accordingly. In describing each of the resources that you have and need for your business to reach profitability, position each of them in terms of the value it will bring to the company, both in the near term and down the road.

To figure out exactly which resources your business is going to need, and account for those in your business planning process, ask yourself these two crucial questions:

• Does starting and growing your business require having staff on hand? If your business relies upon output from people other than yourself and your business partners, you're going to need to allocate resources for hiring staff at fair market rates. 
• What type of equipment or fixed assets will your business need to get going? If your business is dependent upon purchasing or leasing equipment or other fixed assets like retail and office space, these are major considerations as you plan out your resource allocation.

Physical Assets

Depending on the nature of your business, you may have varying need for physical assets. However, in all likelihood you'd need some sort of office furniture and definitely some computers. Physical assets could also include office space, storefronts, manufacturing facilities and equipment necessary for your business. For example, if you own a baked good business, baking equipment like mixers and ovens would be physical assets you'd need to plan for.

Personnel and People

There are different types of people that can be a part of your business. People you hire, for example, can be employees or independent contractors and there are different cost implications for your business depending on whether you hire the former or the latter.

Investing in skills and capacities for people in your business is also an important part of resource planning.

How about mentors, key advisors, supplier connections, and other intangible resources for your business? These types of relationships whose value to your business can be immense, also need to be accounted for within your business plan as they'll have a very large impact on the future growth of your company.

Think of the massively positive effect your company would experience if you had a friend or family member that was a decision-maker at a large company who'd be your perfect first customer. It would undoubtedly be one of your key strategies for driving the early growth of your company. So, as you're planning your resource allocation, you'd naturally be spending in areas that make your young business more appealing to the target customers you want to serve.

Technical Resources

It is a good time to evaluate your technical resources and requirements as well. Some businesses rely more heavily on technology or intellectual property than others. Technology-dependent companies will need a strong IT network to get started. If building your own website won't be any trouble, then that's one major cost you'll be able to avoid as you get started with your company. Otherwise, you may need to allocate for web design, development, and other website-related expenses.

Regardless of your situation, don't be intimidated by the upfront costs of starting a business. Instead, keep in mind that in today's age, your product or service will only be as good as the technology that supports it, and if you buy or build low-grade gear, you’ll probably have to replace it in a few years anyway.

Clearly, there are a lot of different expenses to take into account as you allocate the resources for your new business. However, forcing yourself to go through this activity in extreme detail while building your business plan will save you a lot of headaches and potential failures in the future.

What are assets and resources in a business plan?

Resources can be anything that helps you operate or run your business. Assets are a type of resources that help you achieve you business. Assets can be cash, or physical assets such as equipment or intangible assets such as the brand of your business. In a business plan, you talk about the resources you have and the resources you need to acquire to help your business grow. You also account for your assets on your balance sheet. A strong balance sheet presented in your business plan can be appealing to potential investors.

Which components of a business plan are most useful to attract investors?

Each section of a business plan is important to potential investors. An executive summary gives your investors an elevator pitch to your business. Company description explains to them how your business is solving a market need, while market analysis shows investors you understand your industry and competition. Sections on organization, product details and marketing plans dig deeper into your vision for your business and how its organized. And the financial information component helps them see if you idea is worth putting their money into.

Small Business Administration. " Write your business plan ."

Planview. " Resource Planning: How To Build a Resource Plan ."