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Business analytics (Meenakshi Sundararajan Engineering College)

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UNIT IV HR

Business Analytics (Anna University)

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UNIT IV HR & SUPPLY CHAIN ANALYTICS

Human Resources – Planning and Recruitment – Training and Development - Supply chain
network - Planning Demand, Inventory and Supply – Logistics – Analytics applications in
HR & Supply Chain - Applying HR Analytics to make a prediction of the demand for hourly
employees for a year
4. HUMAN RESOUCE MANAGEMENT
4.1. INTRODUCTION AND MEANING
Human Resources are the wealth of an organization which can help it in achieving its goals.
Human resource management is concerned with the human beings in an organization. It
reflects a new outlook which views organization’s manpower as its resources and assets.
Human resource is the total knowledge, abilities, skills, talents and aptitudes of an
organization’s workforce. The values, ethics, beliefs of the individuals working in an
organization also form a part of human resource. In the present complex environment, no
business or organization can exist and grow without appropriate human resources. So human
resource has become the focus of attention of every progressive organization.

Human resource management is that process of management which develops and manages
the human elements of an enterprise. It is not only the management of skills but also the
attitudes and aspirations of people. When individuals come to a work place, they come with
not only technical skills, knowledge, experience etc., but also with their personal feelings,
perceptions, desires, motives, attitudes, values etc. So HRM means management of various
aspects of human resources. An important element of human resource management is the
humane approach while managing people. This approach helps a manager to view his people
as an important resource. It is an approach in which manpower resources are developed not
only to help the organization in achieving its goals but also to the self- satisfaction of the
concerned persons. On the one hand this approach focuses on human resource development,
and on the other hand it focuses on effective management of people onthe other.
4.1.1. DEFINITION OF HUMAN RESOURCE MANAGEMENT
It is a process by which the people and organizations are bound together in such a way that
both of them are able to achieve their objectives.
According to Flippo, “Human resource management is the planning, organizing, directing
and controlling of the procurement, development, compensation, integration,
maintenance and reproduction of human resources to the end that individual,
organizational and societal objectives are accomplished. ”
The purpose of these functions is to assist in the achievement of basic organizational,divisional
and societal goals.
According to Institute of Personnel Management (U.K.) :
“Personnel Management is an integral but distinctive part of management concerned with
people at work and their relationships within the enterprise. It seeks to bring together into an
effective organization the men and women who staff the enterprise enabling each to make
his/her best contribution to its success, both as a member of a working group and as an
individual. It seeks to provide relationship within the enterprise that are conducive both to
effective work and human satisfaction.

4.1.2. FEATURES OF HRM

It has the following features:

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1 Pervasive force: HRM is pervasive in nature. It is present in all enterprises. It permeates all
levels of management in an organization.
2 Action oriented: HRM focuses attention on action, rather than on record keeping, written
procedures or rules. The problems of employees at work are solved through rational policies.
3 Individually oriented: It tries to help employees develop their potential fully. It encourages
them to give their best to the organization. It motivates employees through a systematic
process of recruitment, selection, training and development coupled with fair wage policies.
4 People oriented: HRM is all about people at work, both as individuals and groups. It tries
to put people on assigned jobs in order to produce good results. The resultant gains are used
to reward people and motivate them towards further improvements in productivity.
5 Future oriented: Effective HRM helps an organization in meeting its goals in the future by
providing for competent and well-motivated employees.
6 Development oriented: HRM intends to develop the full potential of employees. The reward
structure is tuned to the needs of employees. Training is offered to sharpen and improve their
skills. Employees are rotated on various jobs so that they gain experience and exposure. Every
attempt is made to use their talents fully in the service of organizational goals.
7 Integrating mechanism: HRM tries to build and maintain cordial relations between
people working at various levels in the organization. In short, it tries to integrate human
assets in the best possible manner in the service of an organization.
8 Comprehensive function: HRM is, to some extent, concerned with any organizational
decision which has an impact on the workforce or the potential workforce. The term
‘workforce’ signifies people working at various levels, including workers, supervisors, middle
and top managers. It is concerned with managing people at work. It covers all types of
personnel. Personnel work may take different shapes and forms at each level in the
organizational hierarchy but the basic objective of achieving organizational effectiveness
through effective and efficient utilization of human resources, remains the same. “It is
basically a method of developing potentialities of employees so that they get maximum
satisfaction out of their work and give their best efforts to the organization”. (Pigors and
Myers)
9 Auxiliary service: HR department exist to assist and advise the line or operating managers
to do their personnel work more effectively. HR Manager is a specialist advisor. It is a staff
function.
10 Inter-disciplinary function: HRM is a multi-disciplinary activity, utilizing knowledge and
inputs drawn from psychology, sociology, anthropology, economics, etc. To unravel the
mystery surrounding the human brain, managers, need to understand and appreciate the
contribution of all such ‘soft’ disciplines.
11 Continuous functions: According to Terry, HRM is not a one shot deal. It cannot be
practiced only one hour each day or one day a week. It requires a constant alertness and
awareness of human relations and their importance in every day operations.

4.1.3. Scope of HRM

The scope of HRM is very wide. Research in behavioral sciences, new trends in managing
knowledge workers and advances in the field of training have expanded the scope of HR
function in recent years. The Indian Institute of Personnel Management has specified the scope
of HRM thus:

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i. Personnel aspect: This is concerned with manpower planning, recruitment, selection,

placement, transfer, promotion, training and development, lay off and retrenchment,
remuneration, incentives, productivity, etc.
ii. Welfare aspect: It deals with working conditions and amenities such as canteens, creches,
rest and lunch rooms, housing, transport, medical assistance, education,health and safety,
recreation facilities, etc.
iii. Industrial relations aspect: This covers union-management relations, joint consultation,
collective bargaining, grievance and disciplinary procedures, settlement of disputes, etc.

4.1.4. Objectives of HRM

The principal objectives of HRM may be listed thus:
i. To help the organization reach its goals: HR department, like other departments in an
organization, exists to achieve the goals of the organization first and if it does not meet this
purpose, HR department (or for that matter any other unit) will wither and die.
ii. To employ the skills and abilities of the workforce efficiently: The primary purpose of
HRM is to make people’s strengths productive and to benefit customers, stockholders and
employees.
iii. To provide the organization with well-trained and well-motivated employees: HRM
requires that employees be motivated to exert their maximum efforts, that their performance
be evaluated properly for results and that they be remunerated on the basis of their contributions
to the organization.
iv. To increase to the fullest the employee’s job satisfaction and self-actualisation: It tries to
prompt and stimulate every employee to realize his potential. To this end suitable programmes
have to be designed aimed at improving the quality of work life (QWL).
v. To develop and maintain a quality of work life: It makes employment in the organization a
desirable, personal and social, situation. Without improvement in the quality of work life, it is
difficult to improve organizational performance.
vi. To communicate HR policies to all employees: It is the responsibility of HRM to
communicate in the fullest possible sense; tapping ideas, opinions and feelings of customers,
non-customers, regulators and other external public as well as understanding the views of
internal human resources.
vii. To be ethically and socially responsive to the needs of society: HRM must ensure that
organizations manage human resource in an ethical and socially responsible manner through
ensuring compliance with legal and ethical standards.
4.1.5. What Is HR Analytics?
• To understand the essence of HR analytics and to explain how it impacts business
performance, we asked Mick Collins, Global Vice President, Workforce Analytics &
Planning Solution Strategy and Chief Expert at SAP SuccessFactors, to break it down
for us.
• “HR analytics is a methodology for creating insights on how investments in human
capital assets contribute to the success of four principal outcomes:
o generating revenue,
o minimizing expenses,
o mitigating risks, and (
o executing strategic plans.
This is done by applying statistical methods to integrated HR, talent management,
financial, and operational data,” says Collins in an exclusive discussion with HR Technologist.

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HR analytics focuses primarily on the HR function and is not – as is largely believed

– exactly interchangeable with people analytics or workforce analytics.

The difference between HR Analytics, People Analytics, and Workforce Analytics

• HR analytics: HR analytics specifically deals with the metrics of the HR
function, such as time to hire, training expense per employee, and time until
promotion. All these metrics are managed exclusively by HR for HR.
• People analytics: People analytics, though comfortably used as a synonym for
HR analytics, is technically applicable to “people” in general. It can encompass
any group of individuals even outside the organization. For instance, the term
“people analytics” may be applied to analytics about the customers of an
organization and not necessarily only employees.
• Workforce analytics: Workforce analytics is an all-encompassing term referring
specifically to employees of an organization. It includes on-site employees,
remote employees, gig workers, freelancers, consultants, and any other individuals
working in various capacities in an organization

• In the HR context, some workforce analytics metrics and HR analytics metrics may
overlap, which is why the two terms are often used as synonyms. The goal of the two may
also be the same.
• For instance, data on employee productivity and performance informs both HR and
workforce analytics, and the goal is to improve retention rates and enhance the employee
experience.
•
4.1.6. How Does HR Analytics Drive Business Value?
• HR has access to valuable employee data. There is a great deal of discussion on
replicating the consumer experience in the employee experience. Essentially, the data
on consumer behavior and mindset can help develop strategies to maximize sales by

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capitalizing on those factors. Similarly, the data useful for the HR function can be
used to improve employee performance, the employee experience, and in turn,
maximize business outcomes.
• Collins offers an example of how HR analytics can be used to enhance business
value. “HR analytics could be used to measure investments in reskilling, which
will deliver the right competencies to support a new revenue model, using data-
driven insights to modify the training offering as sales results emerge.”

Common metrics measured by HR analytic

a. Absence rate: Unscheduled absence rate (Absence days/FTE- full-time equivalent) is

a key HR metrics to measure absenteeism. It tracks the percentage of workers who are
absent during a given period. This metric also provides a benchmark over time: absence
levels can differ from month to month, but over longer periods of time you want the rates
to be relatively low and stable.
b. Absence rate per manager: By dividing the number of absence days in a team or
department by the total FTE (full-time equivalent) in this team or department, HR
can easily identify problem areas within the company. When certain divisions or
managers structurally struggle with high absence levels, they may be doing something
wrong and their performance is likely to suffer.
c. Overtime expense: People don’t mind working overtime every now and again. However,
when overtime goes through the roof, you can expect your absence rates to follow.
Excessive overtime, especially for longer periods of time (e.g. audit season for
accountancy firms), also drives turnover. Consistently high levels of overtime can be
fixed relatively easy by hiring additional employees.
d. Employee Productivity Index: Traditionally, employees work from 9 to 5, yet more
and more people are working from home. Companies are increasingly letting the
traditional mentality go. This means that performance can no longer be measured by
looking at who shows up.
e. Training expenses per employee: A common metric is training expenses per employee.
This metric is helpful in tracking development costs. It also helps HR to

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make smarter investments in developing personnel. HR is coming around to the fact

that day-long training courses are both expensive and inadequate in providing the
continuous learning experience sought by employees.
f. Training effectiveness index: To measure the effectiveness of training, you need to
measure what people learned. You cannot just measure an employee’s performance
before and after a training. This is because people generally apply for training when they
feel they are underperforming. People who perform below their average for one month
are more likely to return to their average performance the next month. This
phenomenon is called ‘regression to the mean’. This would give an unbalanced view of
training effectiveness.

g. Training efficiency: Training effectiveness is important. However, measuring the

efficiency of training will help you make the most of your money.

Another metric to keep track off is how satisfied employees are with development opportunity.
A lack of development opportunities is a key predictor of employee turnover.
h. Employee happiness: Employee happiness (also measured as employee satisfaction) is
more often recognized as a valuable HR metric. Happy employees are productive
employees, they are committed to the organization and don’t mind working overtime when
necessary. Employee happiness is related to commitment to the organization, and
commitment to the job. Low employee happiness in certain parts of the organization
can be an indicator of conflict or work stress.
i. Voluntary turnover rate:. For a lot of companies, voluntary turnover is a key HR
metric. Turnover is final; most people never come back. People often quit their managers,
not their jobs. With that in mind, turnover is another metric that will help you identify
potential problem areas within the organization.
j. Talent turnover rate: This is why you should track the turnover of both your high
potentials and your low potentials. Turnover of your high potentials should be low.
An important cause for high turnover amongst high potentials is a lack of career
opportunity within the company.
k. Retention rate per manager: Retention rates per manager or division is a metric that
helps you identify ineffective managers. Once you have identified these managers, you
can provide them with additional support and train them to become more effective
managers.
4.1.7. Common data sources HR analytics solutions
a. Internal data: Internal data specifically refers to data obtained from the HR
department of an organization. The core HR system contains several data points that can be
used for an HR analytics tool. Some of the metrics that an HRIS system contains includes:
1. Employee tenure
2. Employee compensation
3. Employee training records
4. Performance appraisal data
5. Reporting structure
6. Details on high-value, high-potential employees
7. Details on any disciplinary action taken against an employee
b. External data: External data is obtained by establishing working relationships with
other departments of the organization. Data from outside the organization is also

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essential, as it offers a global perspective that working with data from within the
organization cannot.
1. Financial data: Organization-wide financial data is key in any HR analysis to
calculate, for instance, the revenue per employee or the cost of hire.
2. Organization-specific data: Depending on the type of organization and its core
offering (product or service), the type of data that HR needs to supplement analytics
will vary.
Collins says , “HR leaders at a global retailer should power their analytics engine
with store revenue and costs and customer experience data, whereas HR at a
construction company might pursue operational – health and safety – data and
data related to contingent labor costs.”
3. Passive data from employees: Employees continually provide data that is stored
in the HRIS from the moment they are approached for a job. Additionally, data from
their social media posts and shares and from feedback surveys can be used to guide HR
data analysis.
4. Historical data: Several global economic, political, or environmental events
determine patterns in employee behavior. Such data can offer insights that limited
internal data cannot.

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4.1.8. How to Get Started with HR Analytics

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I. Create a collective mindset

• Before the operational and mathematical aspect can kick in, HR leaders must prepare
their teams and organizations for a workflow-driven by analytics.

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• While the discussion with the C-suite for the need for analytics is one part of the change,
the other is preparing your team to deal with the amount of data that they will now be using
to measure the change.
• This is a crucial aspect of HR’s digital transformation as well as company-wide digital
transformation. Getting the team started on small projects and asking them to create the
reports that they will discuss with business leaders is a good way to begin.

II. Bring in data scientists

• The data scientist is expected to become an integral part of HR teams. They are best suited
to assess the viability of an analytics solution. They can also ensure the robustness of the
statistical modeling and predictions.
• As Collins says, “data scientists will play an invaluable role in creating a culture of
analytics across HR. As the role of HR business partners and generalists evolves to include
skills such as data strategy, analysis, and communication (articulating ‘the story behind the
science’), the data scientist will serve as the coach, mentoring their colleagues across HR
in how to understand, and apply, the insights.”

III. Start small

A great technique to convince stakeholders that HR analytics can drive business value is to
first implement a small project successfully. Called “quick wins,” these projects can deliver
tangible results in a short amount of time with high impact.

IV. Get clearance from the legal team

The sort of data collection that HR analytics uses is governed heavily by compliance laws.
Some legal considerations to keep in mind when implementing an HR analytics solution are:

• Employee privacy and anonymity

• Consent from employees about the amount and type of data being collected
• Establishing the goal of data collection and informing employees accordingly
• IT security when using third-party software to run HR analytics
• Location of the HR analytics vendor – with whom the data will be stored – and their
compliance with local laws
• Collaborate with the legal team of your organization to ensure ethics and compliance
norms are followed.

V. Choose an HR analytics solution

Any HR analytics solution that will be used at scale must have certain components.

4.1.9. The key features of an HR analytics solution

1. They answer the business questions the C-suite asks. This may require that you
invest in a solution to address each question, leading to investments in multiple
analytics solutions for granular data on each question. Alternatively, you may choose
a unified solution that can assess multiple metrics to answer each business question.
2. They are easy to use by individuals who are not data scientists. An accessible
solution created for laypersons is ideal when they want to assess any one or more
metrics without interrupting the workflow of the data scientist.
3. They are cloud-based rather than on-premise. A cloud-based solution also aids
accessibility without heavy IT integration. This grants HR the autonomy to use the
solution as and when needed.

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4. They are powered with statistical analysis and machine learning technology.
Big data platforms require advanced data management systems powered by machine
learning and natural language processing. This allows the technology to learn and
reason autonomously, revealing insights that data scientists can then analyze.
5. They are based on predictive analytics. “[Predictive analytics is] the practice of
extracting information from existing data sets to determine patterns and forecast future
outcomes.
6. They are powered with visualization technology. A visual representation of vast
amounts of data can allow for better understanding of trends and events. The complex
data processed through an analytics engine requires advanced visualization software,
as it cannot be presented in simple charts and presentations.
7. They are available through a subscription model. Subscription models of
software as service (SaaS) platforms are useful because they easily allow you to
access the latest upgrades in technology. They also eliminate the significant upfront
expense of purchasing an analytics solution and may be a more cost-efficient way of
investing in analytics.

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4.1.10. A guide to implementing HR analytics

Step 1. Choose metrics and KPIs to monitor and predict

To kick-start the HR analytics in a company, formulate the questions about the
workforce that correlate to business outcomes a company must achieve: What do we
need to measure? How are given metrics interconnected with each other? What events
or values are necessary to forecast? If you already use custom KPIs or you want to
introduce some, document them in addition to standard HR metrics.
When documenting a custom KPI or metric, describe in detail:
• What measure it expresses
• How it’s calculated/generated
• In what form it’s represented (text, numeric)
• With what frequency the measure must be taken.
• From what data source an indicator will be retrieved for the processing and
analysis.
Selecting indicators and metrics for HR systems with predictive capabilities is a task
in itself. Machine learning models take into account problem properties called features
to forecast outputs (future events or values). To develop a model able to predict
outcomes with needed accuracy, specialists must select relevant features for itstraining.
So, you need to evaluate the set of factors that may lead to a given (positive or negative)
future event you intend to predict.

For instance, indicators to consider and use as features to measure or predict

employee engagement may include:

• Social media posts

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• Messages and comments in work chats

• Tenure
• Number of days/weeks/months since the last promotion
• Number of days/weeks since a meeting with an HR manager and a department
manager
• Compensation
• Team size
• Number of people in a work room
• Overtime hours
• Vacation days used
• Commute time
• Net promoter score.
Step 2. Define data sources
Once you defined indicators to track or forecast, documenting sources from which to
pull this data won’t be difficult.
While the number of data sources is company-dependent, they may include:

• ERP HR module (generally has several features and thus data related to time
tracking, employee scheduling, payroll management, or absence management.)
• Recruiting tools/applicant tracking systems
• Employee scheduling software
• Talent management software
• Training systems.
• Google Sheets or Excel files, if you use those
• Skill testing solutions.
Step 3. Decide on a tool: off-the-shelf or custom
So, you defined from which systems to source information, handled data ownership
issues with partners, outlined the scope of tasks your HR system must perform, as
well as metrics and KPIs to measure, and events/or forecast. The next consideration is
whether to get an off-the-shelf tool or build your own system.

Off-the-shelf solutions. There are many HR platforms available on the market, such
as Gust, Cezanne HR, Zoho People Plus, or Namely. These products have features for
recruitment, onboarding, performance management, payroll and benefits management,
employee engagement, etc. End-to-end BI solutions also include HR use cases, for
example, Microsoft Power BI.
Step 4. Gather a team
The project team might include these roles:
• HR manager – responsible for developing and maintaining HR plans and
operations, defines a set of modules and features in a system and suggests what
KPIs and metrics it must track and predict.
• Data engineer – builds interfaces and infrastructure to enable access to data.
They make data pipelines work. We wrote an article on data engineering and
discussed the data engineer role with peers, so check it out if you’re curious.
• Data warehouse developer – models, develops, and maintains data storages.
• Database administrator – responsible for database management.

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• Data analyst – defines ways of retrieving data from sources, chooses a

subgroup of data that works best for solving a specific problem, processes it,
and analyzes results with the help of statistical techniques.
• ETL developer – a software engineer that manages data extraction, its
transformation, and loading into a final storage system.
• Data scientist – handles data analysis to uncover insights about the
organization’s operations and supports decision-making. The specialist applies
such techniques as data mining, machine learning, deep learning (the subset of
ML), as well as preprocesses and transforms datasets to prepare them for model
training.
• Front-end developer – codes the side of application with which a user interacts
– a client-side AKA front-end.
• UX designer – defines optimal and efficient scenarios of interaction with a
product.
• UI designer – creates the visual style and look of a user interface.

Step 5. Set up data infrastructure: ETL and a data warehouse

The infrastructure for this task (particularly the HR analytics system architecture)
includes a data integration tool and a data warehouse.
Tools for data integration. Data integration tools move data from initial systems into
a warehouse. ETL (extract, transform, load) is of the ways to carry out this process.
And, that’s why data integration tools are also called ETL tools. The ETL process
includes three phases:
Extract – connecting to sources of information and retrieving it.
Transform – processing raw data and formatting it according to predefined standards.
Data is transformed while being placed in a temporary storage – staging area.
Load – uploading transformed data into the warehouse, where it can be queried and
used both for visualization (descriptive analytics level) and for drawing predictions
(predictive level).

Step 6. Build a predictive model

• The central goal of this phase is to develop a model that provides the most accurate
predictions for a given question.

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• Data scientists check whether a data warehouse contains data required for solving a
specific problem. If there is not enough data, they initiate additional data collection.
After having prepared data for machine learning, the specialists start model training.
• Model training is about providing an ML algorithm with historical training data with
target attributes (correct answers to predict) or without them. Data with mapped
attributes (AKA labels) are used if you want to predict known attributes in new data,
and this model training style is called supervised learning. The learning algorithm will
eventually learn how to find patterns in the training data that map the input data
attributes to the correct answer and outputs an ML model that can spot these patterns in
new data. With supervised learning, you can answer questions like “Will this employee
quit in a given period or not?” or “What is the likelihood that the individual will quit?”
The answer to the second question will be numeric, an attrition score.
• Training data without mapped answers is done during unsupervised learning. When
applied to HR use cases, you can cluster the workforce by similarities or differences
via finding unobvious patterns in their data, for instance, defining the criteria that
reveals who becomes a high performer or a low one.
• Then models are tested and evaluated on their accuracy, and the best model isdeployed
into a software.
• That’s a short way of describing this complex and time-consuming process. Our
article about machine learning project structure provides a more detailed view of data
preparation, model training, and deployment.
Step 7. Develop UI of a solution
• The main purpose of this step is to develop a solution front-end that lets business
users without a data engineering or data science background manipulate data and
generate custom reports: choose sources and combine datasets for analysis via a drag-
and-drop interface.
A checklist of nice-to-have features might include:

• Choosing between static and dynamic (interactive) dashboards. The latter updates
with data and allows users to drill down into data representation.
• A wide selection of charts
• The ability to create ad hoc reports
• Sharable dashboards
• The option to upload custom visuals
• There is always the option to use libraries for data visualization to speed up
development.
Step 8. Train employees on how to use the system
The end-user training is a must since it’s aimed at showing new system functionality. A piece
of advice is to take into account user technical skill level before developing training
approaches. For instance, documentation written in plain language with explanations of the
main concepts and terms and screenshots would be helpful for non-tech users. Video tutorials
and interactive onboarding tools that instruct users along the way are also good supplements to
the text sources. It’s not only about self-service training tools and materials – a seminar- style
group demonstration can work as well.

4.2. Human Resource Planning

Human Resource Planning (HRP) is the process of forecasting the future human resource
requirements of the organization and determining as to how the existinghuman resource
capacity of the organization can be utilized to fulfill these

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requirements. It, thus, focuses on the basic economic concept of demand and supply in
context to the human resource capacity of the organization.

4.2.1. Definition of Human Resource Planning

The following definitions will help to understand properly the concept of human resource
planning: According to Eric W, Vetter, "Human resource planning is the process by which
a management determines how an organization should move from its current manpower
position to its desired manpower position. Through planning a management strives to
have the right number and the right kinds of people at the right places, at the right time
to do things which result in both the organization and the individual receiving the
maximum long range benefit."
According to Leon C. Meginson, "Human resource planning is an integration approach
to performing the planning aspects of the personnel function in order to have a sufficient
supply of adequately developed and motivated people to perform the duties and tasks
required to meet organizational objectives and satisfy the individual needs and goals of
organizational members."
According to Bruce P. Coleman, "Manpower planning is the process of determining
manpower requirements and the means for meeting those requirements in order to carry
out the integrated plan of the organization."
According to E. Geister, "Manpower planning is the process including forecasting,
developing and controlling by which a firm ensures that it has the right number of people
and the right kind of people at the right places at the right time doing work for which
they are economically most useful."

4.2.2. Features of human resource planning

A discussion of various definitions brings out the following features of human resource
planning:
1. Objective must be well defined. The objectives of the organization in strategic planning and
operating planning may form the objectives of human resource planning. Human resource
needs are planned on the basis of the company's goals. Besides, human resource planning has
its own objectives like developing human resource, updating technicalexpertise, career
planning of individual executives and people, ensuring better commitment of people and
so on.
2. Determining Personnel Needs. Human resource planning is related to the determination of
personnel needs in the organization. The thinking will have to be done in advance so that the
persons are available at a time when they are needed. The organization may also have to
undertake recruiting, selecting and training process also.
3. Present Manpower Inventory. It includes the inventory of present manpower in the
organization. The manager should know the persons who will be available to him for
undertaking higher responsibilities in the near future.
4. Adjusting Demand and Supply. Manpower requirements have to be planned well in
advance as suitable persons are not immediately available. In case sufficient persons will not
be available in future then efforts should be made to start recruitment process well inadvance.
The demand and supply of personnel should be seen in advance.
5. Creating Proper Working Environment. Besides estimating and employing personnel,
manpower planning also ensures that proper working conditions are created. People should like
to work in the organization and they should get proper job satisfaction.

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4.2.3. Need for HRP in Organizations:

Major reasons for the emphasis on HRP at the Macro level:
1) Employment-Unemployment Situation: Though in general the number of educated
unemployment is on the rise, there is acute shortage for a variety of skills. This emphasizes
on the need for more effective recruitment and employee retention.
2) Technological Change: The changes in production technologies, marketing methods and
management techniques have been extensive and rapid. Their effect has been profound on the
job contents and job contexts. These changes have caused problems relating to redundancies,
retention and redeployment. All these suggest the need to plan manpower needs intensively
and systematically.
3) Demographic Change: The changing profile of the work force in terms of age, sex,
literacy, technical inputs and social background has implications for HRP.
4) Skill Shortage: Unemployment does not mean that the labour market is a buyer’s market.
Organizations generally become more complex and require a wide range of specialist skills
that are rare and scare. A problem arises in an organization when employees with such
specialized skills leave.
5) Governmental Influences: Government control and changes in legislation with regard to
affirmative action for disadvantages groups, working conditions and hours of work,
restrictions on women and child employment, causal and contract labour, etc. have stimulated
the organizations to be become involved in systematic HRP.
6) Legislative Control: The policies of “hire and fire” have gone. Now the legislation makes
it difficult to reduce the size of an organization quickly and cheaply. It is easy to increase but
difficult to shed the fat in terms of the numbers employed because of recent changes in labour
law relating to lay-offs and closures. Those responsible for managing manpower must look far
ahead and thus attempt to foresee manpower problems.
7) Impact of the Pressure Group: Pressure groups such as unions, politicians and persons
displaced from land by location of giant enterprises have been raising contradictory pressure
on enterprise management such as internal recruitment and promotion, preference to
employees’ children, displace person, sons of soil etc.
8) Systems Approach: The spread of system thinking and advent of the macro computer as
the part of the on-going revolution in information technology which emphasis planning and
newer ways of handling voluminous personnel records.
9) Lead Time: The long lead time is necessary in the selection process and training and
deployment of the employee to handle new knowledge and skills successfully.

4.2.4. HRP Process

HRP effectively involves forecasting personnel needs, assessing personnel supply and
matching demand –supply factors through personnel related programmes. The HR planning
process is influenced by overall organizational objectives and environment of business.

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Environmental Scanning:
It refers to the systematic monitoring of the external forces influencing the organization. The
following forces are essential for pertinent HRP.
 Economic factors, including general and regional conditions.
 Technological changes
 Demographic changes including age, composition and literacy,
 Political and legislative issues, including laws and administrative rulings
 Social concerns, including child care, educational facilities and priorities.
By scanning the environment for changes that will affect an organization, managers can
anticipate their impact and make adjustments early.
Organizational Objectives and Policies: HR plan is usually derived from the organizational
objectives.
• Specific requirements in terms of number and characteristics of employees should be
derived from organizational objectives
• Once the organizational objectives are specified, communicated and understood by all
concerned, the HR department must specify its objective with regard to HR utilization
in the organization.
HR Demand Forecast:
• Demand forecasting is the process of estimating the future quantity and quality of
people required to meet the future needs of the organization. Annual budget and long-

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term corporate plan when translated into activity into activity form the basis for HR
forecast.
• For eg: in the case of a manufacturing company, the sales budget will form the basis
for production plan giving the number and type of products to be produced in each
period. This will form the basis upon which the organization will decide the number
of hours to be worked by each skilled category of workers. Once the number hours
required is available organization can determine the quality and quantity of personnel
required for the task.
• Demand forecasting is influenced by both internal factors and external factors: external
factors include competition, economic climate, laws and regulatory bodies, changes in
technology and social factors whereas internal factors are budget constraints,
production level, new products and services, organizational structure and employee
separations.
• Demand forecasting is essential because it helps the organization to 1. Quantify the
jobs, necessary for producing a given number of goods, 2. To determine the nature of
staff mix required in the future, 3. To assess appropriate levels in different parts of
organization so as to avoid unnecessary costs to the organization, 4. To prevent
shortages of personnel where and when, they are needed by the organization. 5. To
monitor compliances with legal requirements with regard to reservation of jobs.
• Techniques like managerial judgment, ratio- trend analysis, regression analysis, work
study techniques, Delphi techniques are some of the major methods used by the
organization for demand forecasting.
HR Supply Forecast:
• Supply forecast determines whether the HR department will be able to procure the
required number of workers. Supply forecast measures the number of people likely to
be available from within and outside an organization, after making allowance for
absenteeism, internal movements and promotions, wastage and changes in hours, and
other conditions of work.
• Supply forecast is required because it is needed as it
1. Helps to quantify the number of people and positions expected to be available in
future to help the organization realize its plans and meet its objectives
2. Helps to clarify the staff mixes that will arise in future
3. It assesses existing staffing in different parts of the organization.
4. It will enable the organization to prevent shortage of people where and when they
are most needed.
5. It also helps to monitor future compliance with legal requirements of job
reservations.
Supply analysis covers the existing human resources, internal sources of supply and
external sources of supply.
HR Programming:
• Once an organization’s personnel demand and supply are forecasted the demand and
supply need to be balanced in order that the vacancies can be filled by the right
employees at the right time.
HR Plan Implementation:
• HR implementation requires converting an HR plan into action. A series of action are
initiated as a part of HR plan implementation. Programmes such as recruitment,
selection and placement, training and development, retraining and redeployment,
retention plan, succession plan etc when clubbed together form the implementation part
of the HR plan

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Control and Evaluation:

• Control and evaluation represent the final phase of the HRP process. All HR plan
include budgets, targets and standards. The achievement of the organization will be
evaluated and monitored against the plan.
• During this final phase organization will be evaluating on the number of people
employed against the established (both those who are in the post and those who are in
pipe line) and on the number recruited against the recruitment targets. Evaluation is
also done with respect to employment cost against the budget and wastage accrued so
that corrective action can be taken in future.

4.2.5. Factors Affecting HRP:

HRP is influenced by several factors. The most important of the factors that affect HRP are
(1) type and strategy of organization (2) organizational growth cycles and planning (3)
environmental uncertainties (4) time horizons (5) type and quality of forecasting information
(4) nature of jobs being filled and (5) off loading the work.
1. Type and Strategy of the Organization: Type of the organization determines the
production processes involve, number and type of staff needed and the supervisory and
managerial personnel required. HR need is also defined by the strategic plan of organization.
If the organization has a plan for organic growth then organization need to hire additional
employees. On the other hand If the organization is going for mergers and acquisition, then
organization need to plan for layoffs, as mergers can create, duplicate or overlap positionsthat
can be handled more efficiently with fewer employees.
• Organization first decides whether to be reactive or proactive in HRP. Organizations
either carefully anticipate the needs and systematically plan to fill the need in advance
(proactive) or can simply react to the needs as they arise (reactive). Likewise, the
organization must determine the width of the HR plan.
• Organization can choose a narrow focus by planning in only one or two HR areas like
recruitment and selection or can have a broad perspective by planning in all areas
including training and remuneration.

• The nature of HR plan is also decides upon the formality of the plan. It can decides to
have an informal plan that lies mostly in the minds of the managers and personnel staff
or can have a formal plan which is properly documented in writing
• The nature of HR plan is also depended upon the flexibility that is practiced in the
organization. HR plan should have the ability to anticipate and deal withcontingencies.
Organizations frame HRP in such a way that it can contain many contingencies, which
reflect different scenarios thereby assuring that the plan isflexible and adaptable.

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Figure 2.1 : Factors Affecting HRP.

Figure 2.1 summarizes the five factors that influence an organization while framing its
strategic HRP.
2. Organizational Growth Cycles and Planning:
• All organizations pass through different stages of growth from the day of its inception.
The stage of growth in which an organization is determines the nature and extends of
HRP. Small organizations in the earlier stages of growth may not have well defined
personnel planning. But as the organization enters the growth stage they feel the need
to plan its human resource.
• At this stage organization gives emphasis upon employee development. But as the
organization reaches the mature stage it experience less flexibility and variability
resulting in low growth rate. HR planning becomes more formalized and less flexible
and less innovative and problem like retirement and possible retrenchment dominate
planning.
• During the declining stage of the organization HRP takes a different focus like planning
to do the layoff, retrenchment and retirement. In declining situation planning always
becomes reactive in nature towards the financial and sales distress faced bythe
company.
3. Environmental Uncertainties: Political, social and economic changes affect all
organizations and the fluctuations that are happening in these environments affect
organizations drastically. Personnel planners deal with such environmental uncertainties by
carefully formulating recruitment, selection, training and development policies and
programmes. The balance in the organization is achieved through careful succession planning,
promotion channels, layoffs, flexi time, job sharing, retirement, VRS and other personnel
related arrangements.
4. Time Horizons: HR plans can be short term or long term. Short term plans spans from six
months to one year, while long term plans spread over three to twenty years. The extent of

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time period depends upon the degree of uncertainty that is prevailing in an organizations
environment. Greater the uncertainty, shorter the plan time horizon and vice versa.

5. Type and Quality of information: The information used to forecast personnel needs
originates from a multitude of sources. The forecast depends to a large extent upon the type
of information and the quality of data that is available to personnel planners. The quality and
accuracy of information depend upon the clarity with which the organizational decision makers
have defined their strategy, structure, budgets, production schedule and so on.

6. Nature of Jobs Being Filled: Personnel planners need to be really careful with respect to
the nature of the jobs being filled in the organization. Employees belonging to lower level who
need very limited skills can be recruited hastily but, while hiring employees for higher posts,
selection and recruitment need to be carried out with high discretion. Organizationneed to
anticipate vacancies far in advance as possible, to provide sufficient time to recruit suitable
candidate.
7. Outsourcing: Several organizations outsource part of their work to outside parties in the
form of subcontract. Outsourcing is a regular feature both in the public sector as well as in the
private sector companies. Many of the organizations have surplus labour and hence instead of
hiring more people they go for outsourcing. Outsourcing is usually done for non critical
activities. Outsourcing of non- critical activities through subcontracting determines HRP.

4.2.6. Stages of Human Resource Planning

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• Current HR Supply: Assessment of the current human resource availability in the

organization is the foremost step in HR Planning.
• It includes a comprehensive study of the human resource strength of the organization
in terms of numbers, skills, talents, competencies, qualifications, experience, age,
tenures, performance ratings, designations, grades, compensations, benefits, etc.
• At this stage, the consultants may conduct extensive interviews with the managers to
understand the critical HR issues they face and workforce capabilities they consider
basic or crucial for various business processes.
• Future HR Demand: Analysis of the future workforce requirements of the business
is the second step in HR Planning.
• All the known HR variables like attrition, lay-offs, foreseeable vacancies, retirements,
promotions, pre-set transfers, etc. are taken into consideration while determiningfuture
HR demand.
• Demand Forecast: Here, it is also essential to understand the business strategy and
objectives in the long run so that the workforce demand forecast is such that it is aligned
to the organizational goals.

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• HR Sourcing Strategy and Implementation: After reviewing the gaps in the HR

supply and demand, the HR Consulting Firm develops plans to meet these gaps as per
the demand forecast created by them.
4.2.7. Executing your HR Analytics project in 8 Steps
1. Read and understand your business plans: HR must understandthe
Corporate and Business Unit Plans, understand what this means in termsof
people programs and capabilities, and must identify, scope, and deliver Data-
Driven HR projects which will help you achieve these business plan outcomes.
2. Scope out your DDHR (data-driven HR) project:

• Ensure and articulate how your first DDHR Project supports Key Areas of Focus for
your client (these could be from the Corporate objectives, LoB objectives, or a
combination)
• For your first DDHR Project, research, brainstorm and document the following – to
the best of your ability:
o The specific objectives, outcomes and metrics related to the project
o The people and organizational requirements/capabilities for delivering on this
o Your gaps when it comes to all aspects of HR & people programs (i.e. if you
need to “improve close rates in our Sales Team” and you don’t have a best
practice Sales Closing Training Course available, then this would be
considered a “gap“)
o The risk, implications and business impacts of not closing that gap

3. Define your primary metric:

• You need to define something we call a Primary Metric which captures the
• essence of what your project is focused on accomplishing.
• You may however decide, at this point in time, to keep this directional in
nature
• (i.e. decrease or increase) and not get into specific targets.
• Targets can be estimated/set in a subsequent stage when you have access to
• hard data.
4. Define your secondary and supporting metrics: You need to define something we
call a Primary Metric which captures the essence of what your project is focused on
accomplishing. You may however decide, at this point in time, to keep this directional
in nature (i.e. decrease or increase) and not get into specific targets. Targets can be
estimated/set in a subsequent stage when you have access to hard data.
5. Articulate the ‘What’: Using your Secondary Metrics, continue segmenting and
analyzing your data, making observations focused on anomalies.
6. Articulate the ‘Why’ behind the ‘What’:
• At this point, you'll have a collection of facts compiled about Top Performer
• Turnover in Sales, for employees in their First Year of Tenure.
• This is qualitative understanding.
• This can be accomplished through a variety of techniques
7. Drive Decisions, Case for Change, Targets and Change Plans: Decision making for
the Line of Business is all about Return on Investment (ROI) - which requires the
development of a Case for Change. Some might call this a Pitch Deck, others a Business
Case.

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8. Implement, Measure Success, Stabilize and Realize Value: Remarkably, “Business

Case Realization” is incredibly easy to ignore - in fact, we are often systematically
forced to move onto the next activity before we have captured results - and
metaphorically “banked the winnings”.

4.2.8. Barriers to HRP

Human Resource Planners face significant barriers while formulating an HRP. The major
barriers are elaborated below:
1) HR practitioners are perceived as experts in handling personnel matters, but are not
experts in managing business. The personnel plan conceived and formulated by the HR
practitioners when enmeshed with organizational plan, might make the overall strategic plan
of the organization ineffective.
2) HR information often is incompatible with other information used in strategy
formulation. Strategic planning efforts have long been oriented towards financial forecasting,
often to the exclusion of other types of information. Financial forecasting takes precedence
over HRP.
3) Conflict may exist between short term and long term HR needs. For example, there
can be a conflict between the pressure to get the work done on time and long term
needs, such as preparing people for assuming greater responsibilities. Many managers are
of the belief that HR needs can be met immediately because skills are available on the market
as long as wages and salaries are competitive. Therefore, long times plans are not required,
short planning are only needed.
4) There is conflict between quantitative and qualitative approaches to HRP. Some
people view HRP as a number game designed to track the flow of people across the
department. Others take a qualitative approach and focus on individual employee

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concerns such as promotion and career development. Best result can be achieved if there is a
balance between the quantitative and qualitative approaches.
5) Non-involvement of operating managers renders HRP ineffective. HRP is not strictly an
HR department function. Successful planning needs a co-ordinated effort on the part of
operating managers and HR personnel.
4.2.9. Requisites for Successful HRP
1. HRP must be recognized as an integral part of corporate planning
2. Support of top management is essential
3. There should be some centralization with respect to HRP responsibilities in order to have
co-ordination between different levels of management.
4. Organization records must be complete, up to date and readily available.
5. Techniques used for HR planning should be those best suited to the data available and
degree of accuracy required.
6. Data collection, analysis, techniques of planning and the plan themselves need to be
constantly revised and improved in the light of experience.
4.3. Recruitment:
4.3.1. Introduction:
• Successful human resource planning should identify our human resource needs.
Once we know these needs, we will want to do something about meeting them. The
next step in the acquisition function, therefore, is recruitment. This activity makes
it possible for us to acquire the number and types of people necessary to ensure the
continued operation of the organization.
• Hallett says, “It is with people that quality performance really begins and
ends.” Robert Heller also says, “If people of poor calibre are hired, nothing
much else can be accomplished and Gresham’s law will work: the bad people
will drive out the good or cause them to deteriorate.”
• Recruiting is the discovering of potential candidates for actual or . Or, from another
perspective, it is a linking activity-bringing together those with jobs to fill and those
seeking jobs.
4.3.2. Recruitment: Meaning and Definition:
• Recruitment forms a step in the process which continues with selection and
ceases with the placement of the candidate. It is the next step in the
procurement function, the first being the manpower planning.
• Recruiting makes it possible to acquire the number and types of people necessary
to ensure the continued operation of the organization. Recruiting is the discovering
of potential applicants for actual or anticipated organizational vacancies.

• According to Edwin B. Flippo, “Recruitment is the process of searching for

prospective employees and stimulating them to apply for jobs in the organization.”
• According to Lord, “Recruitment is a form of competition. Just as corporations
compete to develop, manufacture, and market the best product or service, so they
must also compete to identify, attract and hire the most qualified people.
Recruitment is a business, and it is a big business.”
• In the words of Dale Yoder, “ Recruiting is a process to discover the sources of
manpower to meet the requirements of the staffing schedule and to employ
effective measures for attracting that manpower in adequate numbers to
facilitate effective selection of an efficient working force.”

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Figure 4.1: Recruitment to Human Resource Acquisition Process

According to Werther and Davis, “Recruitment is the process of finding and attracting
capable applicants for employment. The process begins when new recruits are sought and
ends when their applications are submitted. The result is a pool of applicants form which
new employees are selected.”
Dales S. Beach writes, “Recruitment is the development and maintenance of adequate
manpower resources. It involves the creation of a pool of available labour upon whom the
organization can depend when it needs additional employees.”
Thus, recruitment process is concerned with the identification of possible sources of human
resource supply and tapping those sources. In the total process of acquiring and placing human
resources in the organization, recruitment falls in between different sub-processes as shown in
Figure 4.2.
Recruitment process passes through the following stages:

• Recruitment process begins when the personnel department receives requisitions for
recruitment from any department of the company, The personnel requisitions contain
details about the position to be filled, number of persons to be recruited, the duties to
be performed, qualifications expected from the candidates, terms and conditions of
employment and the time by which the persons should be available for appointment
etc.
• Locating and developing the sources of required number and type of employees.
• Identifying the prospective employees with required characteristics.
• Developing the techniques to attract the desired candidates. The goodwill of an
organization in the market may be one technique. The publicity about the company
being a good employer may also help in stimulating candidates to apply. There may
be others of attractive salaries, proper facilities for development etc.
• Evaluating the effectiveness of recruitment process.

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According to Famularo, personnel recruitment process involves five elements, viz., a

recruitment policy, a recruitment organization, a forecast of manpower, the development of
sources of recruitment, and different techniques used for utilising these sources, and a method
of assessing the recruitment programme.
The explanation of these is described below:
1. Recruitment Policy: It specifies the objectives of recruitment and provides
a framework for the implementation of the recruitment programme. It also
involves the employer’s commitment to some principles as to find and employ
the best qualified persons for each job, to retain the most promising of those
hired, etc. It should be based on the goals, needs and environment of the
organization.

2. Recruitment Organization: The recruitment may be centralized like public

sector banks or decentralized. Both practices have their own merits. Thechoice
between the two will depend on the managerial philosophy and the particular
needs of the organization.
3. Sources of Recruitment: Various sources of recruitment may be classified as
internal and external. These have their own merits and demerits.
4. Methods of Recruitment: Recruitment techniques are the means to make
contact with potential candidates, to provide them necessary information and
to encourage them to apply for jobs.
5. Evaluation of Recruitment Programme: The recruitment process must be
evaluated periodically. The criteria for evaluation may consist of cost per

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applicant, the hiring ratio, performance appraisal, tenure of stay, etc. After
evaluation, necessary improvements should be made in the recruitment
programme.
According to Scott, Clothier and Spriegel the need for recruitment arises out of the
following situations:
• Vacancies created due to expansion, diversification, and growth of business.
• An increase in the competitive advantage of certain concerns, enabling them to get
more of the available business than formerly.
• An increase in business arising from an upswing during the recovery period of a
business cycle.
• Vacancies created due to transfer, promotion, retirement, termination, permanent
disability or death.
• The normal population growth, which requires increased goods and services to meet
the needs of the people.
• A rising standard of living, which requires more of the same goods and services as
well as the creation of new wants to be satisfied

4.3.3. Recruitment policy

Recruitment policy specifies the objectives of recruitment and provides a framework for the
implementation of the recruitment programme. According to Yoder and Others, "A
recruitment policy may involve commitment to broad principles such as filling vacancies
with the best qualified individuals. It may embrace several issues such as extent of promotion
from within, attitudes of enterprise in recruiting its old employees, handicaps, minority groups,
women employees, part time employees, friends and relatives of present employees etc. It may
also involve the organizational system to be developed for implementing recruitment
programme and procedures to be employed.
Elements of a Good Recruitment Policy
A good recruitment policy must contain the following elements:
(i) Organizational Objectives. Both short term and long term organizational objectives must
be taken into consideration as a basic parameter for recruitment decisions.
(ii) Identification of the Recruitment Needs. The recruiters should prepare profiles for each
category of workers and accordingly work out the man specifications, decide the sections,
departments or branches where they should be placed and identify the particularresponsibilities
which may be immediately assigned to them.
(iii) Preferred Sources of Recruitment. Preferred sources of recruitment which would be
tapped by the organization for different classes of employees must be identified.
(iv) Criteria of Selection and Preferences. Selection and preferences should be based on
conscious thought and serious deliberations.
(v) Monetary Aspects. The cost of recruitments and financial implications of the same have
to be kept in mind also.
A recruitment policy involves the employer's commitment to such general principles as :
(i) To find and employ the best qualified persons for each job.
(ii) To retain the most promising of those hired
(iii) To offer promising opportunities for life time working careers.
(iv) To provide facilities and opportunities for personnel growth on the job.
Pre-Requisites of a Good Recruitment Policy
The recruitment policy of an organization must satisfy the following conditions:
1. It should be in conformity with the general personnel policies,
2. It should be flexible enough to meet the changing needs of an organization.

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3. It should provide employees with job security and continuous employment,

4. It should integrate organizational needs and employee needs.
5. It should match the qualities of the employees with the requirements of the work for
which they are employed.
6. It should highlight the necessity of establishing job analysis.
7. It should provide suitable jobs to handicapped, women and minority groups.
To summarize, according to Yoder, "The recruitment policy is concerned with quantity
and qualifications of manpower"
4.3.4. Situational factors affecting recruitment:
Every organization, big or small has to engage in recruitment of persons, as recruitment
provides the most productive of all resources viz. employees, to an organization. Recruitment
has two important aspects (i) to find out the number of vacancies to be notified and the type
of applicants needed to fill them and (ii) to approach the potential applicants to apply for
such vacancies. No organization can recruit successfully without taking intoconsideration the
following factors:

Recruitment-Matching the Organization’s and Applicants' Requirements

1. The Economic Factors. Economic conditions of a country influence the recruitment
process in all the organizations. The globalization and liberalization of Indian economy, since
1991 onwards has resulted in a boom in financial services in India. As a result of the new
economic policy, the demand for MBA/CA/ICWA/CFA students has grown tremendously.
Even the engineering students had to get finance/marketing degrees or diplomas to en cash
job opportunities as their demand, especially in the manufacturing sector has not kept pace.
People with specific fund management skills were in great demand. Companies had to resort
to extensive advertising to hire suitable people. But the trend had changed by the late 1990s.
Except software and pharmaceuticals sectors, recession had set in almost all the other sectors.
As a result, companies had to cut down their recruitment costs and they had to resort to less
expensive media advertising only in place of campus recruitment, search firms, employee
referrals, contractors etc.
2. The Social Factors. The social factors also affect the recruitment policy of an organization.
Social changes in the past two decades in India have forced organizations to place increased
emphasis on recruitment. The mentality of modern employees has changed from 'just any job'
to a 'satisfying career'. If they are not satisfied with their jobs they don’t hesitate to leave the
organizations and go in search of greener pastures outside. To ward off such problems, the
companies, now-a-days, present a more realistic picture of the job and the encouraging career
opportunities to prospective employees through innovative recruitment campaigns.
The organizations have to be aware of and sensitive to the prevailing social values and norms,

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otherwise their recruitment efforts could go off the track. The organizations should emphasize
opportunities for training and development and progression through a series of jobs within
the
same organization.
3. The Technological Factors. The globalization and liberalization of economy since 1991
has brought about rapid changes in the fields of banking, electronics, telecommunications,
automobiles, and software and pharma industries. New technologies have created new jobs
and existing jobs have undergone rapid changes. Several old jobs have disappeared from the
scene.
Technological changes have led to a chronic shortage of people with requisite skills and
knowledge. In such a scenario, companies have to step up their recruitment efforts to compete
successfully for a small number of suitable candidates.
4. The Political Factors. The late 1980s brought the concept of 'equal employment
opportunity in the corporate circles. Companies at last, realised that employment should be
defined in terms of ability to perform the job, rather than in terms of race, colour, religion,
sex or national origin.
However, political compulsions and constitutional provisions covering reservations for special
groups, come in the way of recruiting people, based solely on qualifications, skillsand
experience. Influence of unions, recommendations of friends and relatives of management,
political leaders etc. also play an important role in recruitment policies followed by a
concern.
5. The Legal Factors. The different legislative policies governing child labour, night shifts,
bonded labour, contract labour etc. have brought the legal environment to be a major factor to
be looked into carefully by all companies intending to recruit people for various positions.
Some of the important legislations affecting recruitment are :
(i) The Factories Act, 1948. The Factories Act prohibits the employment of women and
children below 14 years of age in certain jobs which involve night work, underground jobs,
carrying heavy loads etc.
(ii) The Apprentices Act, 1961. The Apprentices Act provides for a machinery to lay down
syllabi and specify period of training, mutual obligations of apprentices and employees etc.
The apprentice after serving a contractual term of training can be taken on regular rolls. The
Act as amended in 1986, provides for revised rates of compensation during the apprenticeship
period and for failure on the part of the employer to execute the terms of the contract.
(iii) The Employment Exchanges Act, 1959. The Employment Exchanges Act, 1959
requires all employers to notify the vacancies arising in their establishments to prescribed
employment exchange before these are filled. The Act covers all establishments in public sector
and nonagricultural
establishments employing 25 or more workers in the private sector.
(iv) The Contract Labour Act, 1970. The Contract Labour Act is applicable to every
establishment (contractor) employing 20 or more persons. It tries to regulate the employment
conditions of contract labour in certain establishments and also provides for the abolition of
contract labour in certain circumstances.
(v) Bonded Labour System (Abolition) Act, 1976. This Act provides for the abolition of
bonded labour (system of forced labour to liquidate debts payable to parties who are bent on
exploiting the vulnerability of the victim) or his family members.
(vi) The Child Labour Act, 1986. The Child Labour Act prohibits the employment of

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children below 14 years of age to certain employments. This has become a serious issue in
India recently when German firms refused to accept carpets exported from Uttar Pradesh,
objecting to the employment of child labour in the carpet industry.
4.3.5. SOURCES OF RECRUITMENT:
Before an organization actively begins to recruit applicants, it should consider the most likely
source of the type of employee it needs. Some companies try to develop new sources while
most try to tackle the existing sources they have. These sources, accordingly, may be termed
as internal and external. Management considers several variables in deciding on the extent to
which they will depend on inside and outside sources. Among the most important are the
following:
1. The effect of the policy on the attitudes and actions of all employees. It is often cited as
the major reason for a policy of promotion from within. Most employees are likely to feel more
secure and to identify their own long term interests with those of the organization when they
can anticipate first chance at job opportunities. On the other hand, general application of the
promotion from within policy may encourage mediocre performance by the employees.
2. The level of specialization required of employees. In many organizations, the principal
source of qualified workers may be the present employees, who have received specialized
training. In new industries or endeavor’s, no other source may be as satisfactory.
3. The emphasis on general economic policy on participation by employees at all levels.
New employees from outside, inexperienced in the firm, may not know enough about its
service or products or processes to participate effectively.
4. The need for originality and initiative. If management feels that it is providing training
for these qualities, it may prefer its own people. If, on the other hand, it feels no such assurance,
that fact may argue for the importation of new people with different ideas.
5. Acceptance of the seniority principles. In most organizations, if emphasis is to be placed
on promotion from within, seniority will play an important part. It is the simplest basis on
which to decide who merits advancement.

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A. INTERNAL SOURCES
Internal source is one of the important sources of recruitment. The employees already working
in the organization may be more suitable for higher jobs than those recruited from outside. The
present employees may help in the recruitment of new persons also. Internal sources consist of
the following:
1. Present Employees
Promotions and transfers from among the present employees can be a good source of
recruitment.
(i) Transfer. Transfer involves shifting of persons from present jobs to other similar places.
These do not involve any change in rank, responsibility and prestige, the number of persons do
not increase with transfers but vacant posts may be attended to.
(ii) Promotions. Promotions refer to shifting of persons to positions carrying better prestige,
higher responsibilities and more salaries. The higher positions falling vacant may be filled up
from within the organization. A promotion does not increase the number of persons in the
organization position. Promotion avenues motivate employees to improve their performance
so that they get promotions to higher positions.
2. Employee Referrals
Employee referrals can be a good source of internal recruitment. Employees can develop good
prospects for their families and friends by acquainting them with the advantages of ajob
with the company furnishing letters of introduction and even encouraging them to apply. This
source is usually, one by the most effective methods of recruiting because many qualified
people are reached at a very low cost to the company. In an organization with alarge
number of employees, this approach can provide quite a large pool of potential organizational
members.
Most employees know from their own experience about the requirements of the job and what
sort of persons the company is looking for. Often employees have friends or acquaintances
who meet these requirements. A major limitation of employee referral is that the referred
individuals are likely to be similar in type to those who are already working in the organization.
This may lead to informal groups based on race, religion or sex.
3. Former Employees
Former employees are another internal source of recruitment. Some retired employees may
be willing to come back to work on a part time basis or recommend someone who would be
interested in working for the company. Sometimes, people who have left the company for
some reason or the other are willing to come back and work. Individuals who left for other
jobs and greener pastures, might be willing to come back at higher emoluments. An
advantage of this source is that the performance of these people is already known.
4. Previous Applicants
Although not an internal source, in the true sense, those who have previously applied for jobs
can be contacted by mail. This is a quick and an inexpensive way to fill an unexpected vacancy.
This is a very suitable method for filling the professional openings.
B. EXTERNAL SOURCES
Every enterprise has to use external sources for recruitment to higher positions when existing
employees are not suitable. More persons are needed when expansions are undertaken.External
methods are discussed as follows:
1. Advertisement. Advertisement is the best method of recruiting persons for higher and
experienced jobs. The advertisements are given in local or national press, trade or
professional journals. The requirements of jobs are given in the advertisements. The
prospective candidates evaluate themselves against their requirements of jobs before sending
their applications.

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Management gets a wider range of candidates for selection. The flood of applications may
create difficulties in the process.
2. Employment Exchanges. Employment exchanges run by the government are also a good
source of recruitment. Unemployed persons get themselves registered with these exchanges.
The vacancies may be notified with the exchanges, whenever there is a need. The exchange
supplies a list of candidates fulfilling required qualifications. Exchanges are a suitable source
of recruitment for filling unskilled, semi-skilled, skilled and operative posts. The job-seekers
and job givers are brought in contact by the employment exchanges.
3. Unsolicited Applicants. Persons in search of employment may contact employers through
telephone, by post or in person. Generally, employers with good reputation get unsolicited
applications. If an opening is there or is likely to be there, then these persons are considered
for such jobs.
Personnel department may maintain a record of unsolicited applications. When jobs
suitable for these persons are available these are considered for employment.
4. Professional Organizations. Professional organizations maintain complete bio-data of
their members and supply it to companies on demand. These organizations also act as exchange
between the members and recruiting firms. Firms can seek clarifications and clear doubts about
persons they want to recruit. This source of recruitment is found reliable for recruiting persons
a middle and upper levels of management.
5. Data Banks. The recruiting firms can prepare a data bank about various persons in different
fields. They can collect information from educational institutions, employment exchanges,
professional organizations etc. It will become another source and the firm can get the
particulars as and when it needs to recruit.
6. Similar Organizations. The organizations producing similar products or having the same
line of business act as an important source of recruitment. The persons having same experience
as required by the recruiting firms will be available in similar organizations. This would be the
most effective source for executive positions and newly established or diversified and
expanded organizations.
7. Casual Callers. Management may appoint persons who casually call on them for meeting
short-term demands. This will avoid following a regular procedure of selection. These
persons are appointed for short periods only. They need not be paid retrenchment or lay off
allowance.
This method of recruitment is economical because management does not incur a liability in
pensions, insurance and fringe benefits.
8. Labour Contractors. It is quite common to engage contractors for the supply of labour.
When workers are required for short periods and are hired without going through the full
procedure of selection etc. Contractors or jobbers are the best source of getting them. The
contractors maintain regular contracts with workers at their places and also bring them to the
cities at their own expense. The persons hired under this system are generally unskilled
workers.
9. Trade Unions. Generally, unemployment and underemployed persons make a request to
trade union leaders for finding suitable jobs for them. Union leaders are aware of various
vacancies in firms and also know the management. These leaders can help in the recruitment
of suitable persons. In some organizations trade unions are consulted before starting a
recruitment process for certain categories of employees. In such situations trade union leaders
can give the names of persons available for recruitment.
10. Gate Recruitment. Unskilled workers may be recruited at the factory gate. In some
industries like jute a large number of workers work as substitute workers. These may be
employed whenever a permanent employee is absent. More efficient among these badly

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workers may be recruited to fill permanent vacancies. A notice on the notice board of the
company specifying the details of the Job Vacancies can be put. Such recruitment is called
direct recruitment. It is a very economical method and used mainly for unskilled and casual job
vacancies.
11. Campus Recruitment. Colleges, universities, research laboratories are fertile grounds for
recruiters. The Indian Institutes of Management (IIMs) and the Indian Institutes of
Technology (IITS) are on the top list of avenues for the recruiters. In fact, in some companies
recruiters are bound to recruit a large number of candidates from these institutes every year.
Campus recruitment is so much sought after by the recruiters that each college, university
department or institute will have to have a placement officer to handle recruitment functions.
Campus recruitment is often an expensive process. Majority of those recruited leave the
organizations after some time in search of greener pastures outside. Problems
notwithstanding, campus placement is the major source of recruitment for prestigious
companies such as Hindustan Lever Limited, Tata, Larsen and Toubro etc.
12. Recruiting Agencies. Several private consultancy firms e.g. A.F. Ferguson Associates,
Price Waterhouse Coopers, ABC consultants etc. perform recruiting function on behalf of
client companies by charging fees. These agencies are particularly suitable for recruitment of
executives and specialists. They perform all the functions of recruitment and selection so that
the client is relieved of this burden. But the cost of recruitment through these agencies is very
high.
13. Walk-ins, Write-ins and Talk-ins. Now-a-days walking-ins are becoming a very popular
method of recruitment. Today's newspapers are full of new openings to be tapped in newer
ways. Six out of ten are through walk-in-interviews. The applicants just walk in with their
resumes for interviews. However, the walk in interviews posts a tough challenge for the
interviewers who do not know how many candidates are to be interviewed. The number of
candidates sometimes be varying directly with the temperature outside. From employee view
point, walk-ins are preferable as they are free from the hassles associated with other methods
of recruitment, In write ins, job seekers send written enquiries and they are asked to complete
application forms for further processing.
Talk-ins are also becoming popular now-a-days. Job aspirants are required to meet therecruiter,
on an appropriated date for detailed talks. No application is required to be submittedin this case.
14. Displaced Persons. Implementation of a project in a particular area would result in
displacement of several hundred inhabitants. Rehabilitating the displaced persons is a social
responsibility of business. Rehabilitation of displaced persons is mandated by the government
and the World Bank has made it conditionality for granting assistance to the concerned country.
However, the track record of companies in this respect is disappointing.
15. Competitors. Rival firms can be a source of recruitment. Popularly called, poaching or
raiding, this method involves, identifying the right people in rival companies, offering them
better terms and luring them away. There are legal and ethical issues involved in raiding rival
firms for potential candidates. Unfortunately, today's young managers are known for
rootlessness and job hopping. Loyalty to the organization is a thing of the past. This is a
challenge for the HR managers.

4.3.6. METHODS OF RECRUITMENT:

Methods of recruitment are different from the sources of recruitment. Sources are the
locations

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where prospective; employees are available. On the other hand, methods are ways of
establishing links with the prospective employees, Various methods employed for recruiting
employees may be classified into the following categories.
1. Direct Methods. Under direct recruitment, employee contacts, manned exhibits and
waiting lists are used. Representatives of the organization are sent to the educational and
training institutions for scouting prospective candidates. These travelling recruiters exchange
information with the students, clarify their doubts, stimulate them to apply for jobs, conduct
campus interviews and short list candidates for further screening. They act in cooperation
with placement head of the institution.
Another direct method is to ask employees of the organization to contact the public and tell
them about the vacancies. Manned exhibits involve sending recruiters to seminars and
conventions, setting up exhibits at fairs and using mobile offices to go to the desired centres.
Some organizations prepare the waiting lists of candidates who have indicated their interest in
jobs in person, through mail or over telephone.
2. Indirect Methods. Advertisement in newspapers, journals, on the radio and television are
used to publicize vacancies. A well thought out and clear advertisement enables candidates to
assess their suitability so that only those possessing the requisite qualifications will apply.
This method is suitable when the organization wants to reach out to large target group
scattered geographically. Considerable details about jobs to be filled and qualifications
required can be given in the advertisements. But a large number of candidates may be
unsuitable.
3. Third Party Methods. Various agencies can be used to recruit personnel. Public
employment exchanges, management consulting firms, professional societies, temporary help
societies, trade unions, labour contractors are the main agencies In addition, friends and
relatives of existing staff and deputation method can be used.
4.3.7. Factor Affecting Recruitment:
The factors affecting recruitment can be classified as internal and external factors.
The internal factors are:
• Wage and salary policies;
• The age composition of existing working force;
• Promotion and retirement policies;
• Turnover rates;
• The nature of operations involved the kind of personnel required;
• The level and seasonality of operations in question;
• Future expansion and reduction programmes;
• Recruiting policy of the organization;
• Human resource planning strategy of the company;
• Size of the organization and the number of employees employed;
• Cost involved in recruiting employees, and finally;
• Growth and expansion plans of the organization.

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The external factors are:

• Supply and demand of specific skills in the labour market;
• Company’s image perception of the job seekers about the company.
• External cultural factors: Obviously, the culture may exert considerable check on
recruitment. For example, women may not be recruited in certain jobs in industry.
• Economic factors: such as a tight or loose labour market, the reputation of theenterprise
in the community as a good pay master or otherwise and such allied issues which
determine the quality
• and quantity of manpower submitting itself for recruitment.
• Political and legal factors also exert restraints in respect of nature and hours of work
for women and children, and allied employment practices in the enterprise, reservation
of Job for SC, ST and so on.
4.3.8. RECENT TRENDS IN RECRUITMENT
The following trends are, being seen in recruitment:
Outsourcing
In India, the HR processes are being outsourced from more than a decade now. A company
may draw required personnel from outsourcing firms. The outsourcing firms help the
organization by the initial screening of the candidates according to the needs of the
organization and creating a suitable pool of talent for the final selection by the organization.
Outsourcing firms develop their human resource pool by employing people for them and make
available personnel to various companies as per their needs. In turn, the outsourcing firms or
the intermediates charge the organizations for the services.
Advantages of outsourcing are:
1. Company need not plan for human resources much in advance.
2. Value creation, operational flexibility and competitive advantage.
3. Turning the management's focus to strategic level processes of HRM.
4. Company is free from salary negotiations, weeding the unsuitable resumes/candidates.
5. Company can save a lot of its resources and time.
Poaching/Raiding

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"Buying talent" (rather than developing it) is the latest mantra being followed by the
organizations today. Poaching means employing a competent and experienced person already
working with another reputed company in the same or different industry; the organization
might be a competitor in the industry. A company can attract talent from another firm by
offering attractive pay packages and other terms and conditions, better than the current
employer of the candidates. But it is seen as an unethical practice and not openly talked
about.
Indian software and the retail sector are the sectors facing the most severe brunt of poaching
today. It has become a challenge for human resource managers to face and tackle poaching,
as it weakens the competitive strength of the firm.
E-Recruitment
Many big organizations use Internet as a source of recruitment. E-recruitment is the use of
technology to assist the recruitment process. They advertise job vacancies through worldwide
web. The job seekers send their applications or curriculum vitae i.e. CV through e-mail using
the Internet. Alternatively, job seekers place their CV's in worldwide web, which can be drawn
by prospective employees depending upon their requirements.
Advantages of E-Recruitment are:
• Low cost.
• No intermediaries
• Reduction in time for recruitment.
• Recruitment of right type of people.
• Efficiency of recruitment process.
4.4. Training and Development:
4.4.1. Training:
• Training is the act of increasing the knowledge and skills of an employee for
doing a particular job. The major outcome of training is learning. Training
learns new habits, refined skills and useful knowledge during the training
that helps him improve performance. Training enables an employee to do his
present job more efficiently and prepare himself for a higher level job. Training,
thus, may be defined as a planned programme designed to improve performance
and bring about measurable change in knowledge, skills attitude and social
behaviour of employees.
• Basically, it is learning experience that is planned and carried out by the
organization to enable more skilled task behaviour by the trainee. Training imparts
the ability to detect and correct error. Furthermore, it provides skills and abilities
that may be called on in the future to satisfy the organizations’ human resources
needs. Training may be carried out on the job or in the classroom and in the latter
case, it may be on site or off site – perhaps in a motel or a training centre – or it
may be in a simulated environment that is thought to be similar to the work
environment in important respects. In any case, trainees are expected to acquire
abilities and knowledge that will enable them to perform their jobs more effectively.
4.4.2. Training vs. Development

• Training and development refer to educational activities within a company created

to enhance the knowledge and skills of employees while providing information and
instruction on how to better perform specific tasks.

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• Training is a short-term reactive process meant for operatives and process while
development is designed continuous pro-active process meant for executives. In
training employees' aim is to develop additional skills and in development, it is to
develop a total personality.

• In training, the initiative is taken by the management with the objective ofmeeting
the present need of an employee. In development, initiative is taken by the individual
with the objective to meet the future need of an employee.

There is a link between training and development, and there is a clear difference
between the two depending on the objectives to be achieved. Development is done to
solve training problem

Training and Development: Distinctions

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Training Vs Education

4.4.3. Need of Training and Development

• The training and development activity is required when company revises its
objectives and goal to adjust the changing market conditions.
• Companies often endorse training and development programs to improve the
performance of the employees.
• The HR training and development is needed to set up a benchmark of performance
which employees are expected to achieve in a financial year.
• There is always a need of training and development efforts to teach the employee
new skills such as team management, communication management and leadership
behavior.
• Training and development is also used to test new methods of enhancing
organizational productivity

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4.4.4. Importance of Training and Development

• In Human Resource Management (HRM) Training and development is important
aspect when company wants optimum utilization of their manpower.
• Training and development is a key for the succession planning of the organization
as it helps in improvement of skills like team management and leadership.
• HR Training and development activities are vital to motivate the employee and to
increase their productivity.
• Training and development in HRM is significant aspect to develop a team spirit in
the organization.

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• Training and development programs are also important from the safety point of
view as it teaches employee to perform job properly without any life risk.
• From the organizational point of view the HR training and development programs
are important performance management tool to increase profitability and enhance
corporate image

4.4.5. Objective and Purpose of Training & Development

• One of the most effective methods to show your employees that you value them is
to provide them with training. It demonstrates that you care as much about their well-
being and development as they do about your company's. Employees that are well taken
care of will never desire to work somewhere else.
• Training can be used as a preventative measure to prepare people for expected and
unforeseen changes and challenges in the workplace. It only makes sense to keep our
staff prepared in times like ours, when trends are always changing due to online
innovation.
• There is no better way to produce future leaders than to train the most talented
individuals available. Employees will have a clear career path, resulting in lower
attrition and discontent.
• Employees are a significant and most important component of a company's assets, and
caring for them entails caring for the firm as a whole. Therefore, any business
organization that invests their time and money in its employees' education or Training
& development can only succeed in achieving their business goals and advancefurther.
4.4.6. Training and Development
o Training and development is a subsystem of the company aimed at improving the
performance of individual employees and groups. Training is an educational
process that involves improving skills and concepts, changing attitudes and
acquiring additional knowledge to improve employee performance. Good and
effective training of employees helps to develop their skills and knowledge, which
ultimately helps the company to improve.

o The training is to know where you are right now and after a while where you will
reach your abilities. Through training, people can explore new information and
methods and update their knowledge and skills. This leads to significant
improvement and summarizes the effectiveness of the work. The reason for the
training is to create an effect that lasts longer than the time of the training itself,

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and the employee is informed about the new phenomenon. The training can be
offered as a refresher course for individuals and groups.
Organizational development is a process aimed at “building capacities to achieve and
sustain a new desired welfare state for the organization or community and the world
around it.

The training cycle

4.4.7. Relationship between training and development

There is a link between training and development, and there is a clear difference between
the two depending on the objectives to be achieved. Development is done to solve training
problems:

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4.4.8. steps involved in Training and Development Process

Training development is a five step process in which company train their employees in specific
skills and further monitor their performance constantly to help them develop overall
personality.

The training and development activity starts with a question about why the training isrequired.
While end with the evaluation of output of training and development program.

Steps involved in Training and Development Process

1. Need of training and development
2. Goals and Objectives
3. Method of Training
4. Implementation of program
5. Evaluation and constant monitoring

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Step I- Need of Training and Development program

Companies often take a decision to roll out a training and development program after
identifying a specific need in the organization. The need could be introduction of new skill or
to update the existing skills of the employee. In the case of employees working on higher level
the training and development program is introduced to improve the behavior skills and ensure
team work in the organization.

Step II- Goals and Objectives of Training and Development

Here are different goals and objectives the companies can set before implementation of training
and development program-

• To impart skills-Under this objective the employees are trained to operate the
equipment and machinery correctly. The goals are set to improve work efficiency and
to reduce wastage of time.
• To Educate: The objective is linked with providing information about theoretical
concepts and provides hands-on experience of the task. The goal is to improvereasoning
power and judgment skills of employees.
• To Enhance Knowledge: The objective here is to improve behavioral knowledge of
the employee. The goal is to enhance understanding of human relations, management
and business environment among employees.
• Ethics: The objective is to provide knowledge about ethical conduct in the
organization. The goal is to regulate the conduct of the employee in the organization.
• Change in attitude: The objective of the training is to change the attitude of the
employees in terms outlook, reaction, feelings and work beliefs. The goal is toimprove
commitment and satisfaction of the employee by providing required motivation.

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• Extraordinary Skills: To impart extraordinary skills such as critical decision making,

problem-solving and industrial research. The goal is make employee ready to face
future challenges.
• Literacy: Objective is to improve corporate language proficiency and increase
awareness about corporate culture. The goal is to make sure employees are able to
handle the international clients and customer in a decent way.
Step III- Training Methods
There exist different types of training methods used by the organization based on the goals and
objectives of the training and development program. Here are few commonly used training
methods in corporate world-

• Orientations: It is generally used to introduce the newly joined employee to the

organizational work culture. It includes few lecture sessions, meetings with supervisor
and information regarding the history of the organization. This training is used to make
sure the newcomer feels welcomed in the organization and become aware about their
work profile, goals and objectives of organization, policies as well as rules and
regulations to be followed.
• Lectures: This is a one-way communication method, mostly used when important
information has to be conveyed to large number of employees. The information can
be related to new updates in policies or any change management action in the
organization.
• Case Study: Here the participants are given a situation in terms of case study and they
have to provide solutions on the stated problem in the provided case. It is a best way
to impart decision making skill and sharpen the judgment skills of the employee.
• Role Playing:A scenario is created and each participant is assigned a particular role to
play out. The participant can practice their actual job work using role play method. The
facilitator provides immediate feedback to the participant which helps them to improve
their performance. These kinds of scenario are very effective while providingmarketing
and management training.
• Simulations: It can be used as a kind of games created from real-life scenarios. The
benefits of this simulations is that employee gets better understanding of whole
organizational structure and can study actual day-to-day problems to get a relevant
solutions on it.
• Computer-Based Training:The employees are provided study material and
instruction on the computer. It allows employees to learn on their own pace and time.
• Self-Instruction:Individualized instruction, programmed learning, personalized
systems of instruction, correspondence study and learner-controlled instruction are
different types of self-instruction training. Here employees are responsible for their own
learning.
• Audiovisual Training:In this type of training films, television and videotapes are used
to expose employees to the real life situation. The presentation includes the situation
and how the problem stated in the situation is resolved. It helps employee to gain
knowledge about diverse corporate situations and provide them an appropriate direction
to take decisions.
• Team-Building Exercises:The training is associated with the human behavior. It
includes activities which can improve group dynamics and worker-management
relations. It can be in the form of outdoor exercise or brainstorming sessions in the
office.

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• Apprenticeships and Internships:It is a kind of on-the-job training in which the newly

joined employee works with experienced employee and learns work related skills while
performing the actual job.
• Job Rotation: In order to enhance the understanding about the whole organization and
to add skills the job rotation method of training is used. Here employees do different
types of job on rotational basis and gain knowledge of different work profile.
Step IV- Implementation of program
The management and HRM department takes a meeting with different supervisors to decide
the time period of implementation of the training and development program. The
implementation of orientation programs and other newcomer training programs is carried out
right after joining of the employee. The specific skills training programs are launched based on
the workload and free time span available to the employee. The on-the-job training program is
an ongoing process and employees should be informed about it in advance.

Step V- Evaluation and constant monitoring

The evaluation of training and development program is generally carried out at the time of
performance appraisal. The changes in performance and attitude are noted based on the
performance review. The increase in productivity and accuracy of work indicates the success
of training and development program. Improved work harmony and organizational
citizenship behavior indicates the wellbeing created by development programs. The constant
monitoring of the behavior of the employee is achieved based on the monthly goal attainment
and team work of the employee. Additional training programs are launched in the case of
absence of any positive results in terms of improved employee performance.

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4.5. What Is Organizational Development?

Organizational development is a planned, systematic change in the values or operations of
employees to create overall growth in a company or organization. It differs from everyday
operations and workflow improvements in that it follows a specific protocol that management
communicates clearly to all employees.

Organizational change and development can be a long, sometimes overwhelming process, but
companies usually begin with several goals in mind:

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• Ongoing improvement. Changing company culture to view new strategies as apositive

growth opportunity allows for ongoing improvement and encourages employees to
become more open to change and new ideas. New strategies are introduced
systematically through planning, implementation, evaluation, improvement, and
monitoring.
• Better or increased communication. Organizational development that leads to
increased feedback and interaction in the organization aligns employees with the
company’s vision. Employees feel that they have more ownership in the company’s
mission and may be more motivated as a result.
• Employee development. In today’s business world, employees must constantly adapt
to changing products, platforms, and environments. Employee development comprises
training and work process improvements that help everyone keep up with shifting
demands.
• Product and service improvement. Organizational development leads to innovation,
which can help improve products and services. This innovation often comes as the
result of intensive market research and analysis.

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• Increased profit. Organizational development helps increase profits by optimizing

communication, employee processes, and products or services. Each serves to increase
a company’s bottom line.

4.5.1. OD Strategy: Five Phases

TD professionals should integrate OD skills with the growing number of L&D, performance
improvement, and talent management solutions focused upon increasing organizational
effectiveness. The process used by OD practitioners to design and implement organizational
development strategies is structured in five phases:

• Entry represents the initial contact between consultant and client in which theypresent,
explore, and identify the problem, opportunities, or situation. The output of this phase
is an engagement contract or project plan that establishes mutual expectations and
preliminary agreements about project scope (such as time, money, and resources).
• Diagnosis (assessment) represents the fact-finding phase. It is a collaborative data
gathering process between organizational stakeholders and the consultant in which
relevant information about the presenting problem is gathered, analyzed, and reviewed.
• Feedback represents the return of analyzed information to the client or client system;
exploration of the information for understanding, clarity, and accuracy; review of
preliminary agreements about scope and resource requirements; and the beginning of
ownership of data by the client. The output of this phase is typically an action plan

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that outlines the change solutions to be developed, along with defined success
indicators based on the information and data analysis.
• Solution represents the design, development, and implementation of the solution or
set of solutions meant to correct the problems, close gaps, improve or enhance
organizational performance and effectiveness, or seize opportunities. Outputs may
include a communication plan, a role-and-responsibility matrix, a training plan, a
training curriculum, an implementation plan, a risk management plan, an evaluation
plan, or a change management plan.<.li>
• Evaluation represents the continuous process of collecting formative and summative
evaluation data to determine whether the initiative is meeting the intended goals and
achieving defined success indicators. Outputs generally include an evaluation report
with recommendations for continuous improvement.

4.5.2. Organization Development Initiatives

Organization development initiatives are typically categorized as:

• Human process initiatives that include team building, interpersonal and group process
approaches, and coaching
• Techno-structural initiatives that include restructuring organizations (for example,
mergers and acquisitions, flexible work design, downsizing, business process
engineering, total quality management, quality of work life, Six Sigma, and Agile)
• Human resource management initiatives that include employee engagement, employee
experience, performance management, employee development, succession planning,
coaching and mentoring, career development, and diversity awareness
• Strategic initiatives that include organization transformation, culture change, leadership
development, and attraction and retention initiatives.

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4.5.3. Some of the most effective learning and development programs today include the
following best practices:
a) Training programs should be strategy-driven
Trainers should be well aware that all training and development programs need to be in
line with the organization’s overall strategic goals
b) Set criteria to define success
The success of training programs should be measured against different criteria. Training
programs should result in a return on investment, either in the long term or the short term
c) Training programs should be supported by key strategies, systems, structures,
policies and practices
When designing a training program, the trainers should ensure that learning is aligned with
and directly supported by organizational structures, lines of authority, decision- making,
values and other business practices. This would help to establish boundaries and reinforce
the desired results.
d) Training should be driven through many channels
Some of the best trainers in the industry help the organizations to explore and utilize
different platforms to reinforce learning outcomes and ensure that people get the right skills
at the right time, in the right way and at the right cost.
e) Learning by doing and establishing shared accountability
Some of the best programs enable the employees to maximize their potential through self-
directed training and development. By identifying their own needs, creating individual
learning plans and seeking learning opportunities, employees are encouraged to take
responsibility for learning and apply the learned concepts at work. By experimenting and
learning by doing, an employee may find himself to be more effective at work and
contribute to organizational success.

4.5.4. Purpose of training and development in organizations

Lowers Attrition
Training is one of the best ways to value your employees. It shows them that you are as invested
in their well being and growth as they are in the your growth as a company. Employees who
are looked after will never want to look elsewhere.
Prepares for upcoming challenges
Training can be a pre-emptive step to train employees for expected/unexpected changes in the
industry. In times like ours when trends change constantly under the influence of online
evolution, keeping our teams prepared just makes good sense.
Fosters Leadership
There is no better way to create future leaders than to train the best bunch. This will also lead
to a clear career path for employees preventing attrition and dissatisfaction.
Growth of the company
Any company dedicated to training its workforce will only prosper and move forward. The
employees are a major part of a company's assets and taking care of them will mean taking care
of the organization.

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4.5.5. Types of Employee Training and Development

o Technical training is training based on a technical product or task. Technical training if

often specifically tailored to a particular job task at a single organization.
o Skills training is training to help employees develop or practice skills that are necessary
for their jobs.
o Soft skills training is a subset of skills training that focuses specifically on soft skills, as
opposed to technical or “hard” skills. Soft skills include emotional intelligence,
adaptability, creativity, influence, communication, and teamwork. Some trainers refer to
soft skills as “power skills” or “professional life skills” to emphasize their importance.
o Compliance training is training on actions that are mandated by a law, agency, or policy
outside the organization’s purview. Compliance training is often industryspecific but may
include topics such as cybersecurity and sexual harassment.
o Quality training refers to familiarizing employees with the means of preventing, detecting,
and eliminating non-quality items, usually in an organization that produces a product.
o Safety training is training that focuses on improving organizational health and safety and
reducing workplace injury. It can encompass employee safety, workplace safety, customer
safety, and digital and information safety. Safety training can include both training that is
required by law and training that organizations offer without legally being required to do
so.
o Management development focuses on providing managers with the knowledge and
skills that they need to be effective managers and developers of talent. Topics may

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include accountability, collaboration, communication, engagement, and listening and

assessing.
o Leadership development is any activity that increases an individual’s leadership ability
or an organization’s leadership capability, including activities such as learning events,
mentoring, coaching, self-study, job rotation, and special assignments to develop the
knowledge and skills required to lead.
o Executive development provides senior leaders and executives with the knowledge and
skills that they need to improve in their roles. In contrast to leadership development, which
focuses on helping non-executive employees develop the skills they need to obtain a
leadership position, executive development is targeted at people already at a leadership
level within their organization.
o Customer service training focuses on providing employees with the knowledge and skills
to provide exceptional customer service. Customer service training should include content
on essential employee behaviors, service strategies, and service systems.
o Customer education training is when employees—often at technology or SaaS
companies—teach customers how to use a company’s products and services. Customer
education training differs from traditional employee learning and development because the
intended audience is customers, not employees.
o Workforce training focuses on upskilling workers to help them obtain career success.
Workforce training programs are often offered by federal, state, or local governments, or
by nonprofit organizations. Workforce training may include job specific content but also
may include content on organizational culture, leadership skills, and professionalism.
Workforce training is often accessed by people who are new to the workforce or who are
trying to enter a new job type or industry.
o Corporate training focuses on helping workers already employed by an organization
obtain new knowledge and skills. That company or organization offers training to their
internal employees to help them become better at their current jobs, advance in their
careers, or close organizational skill gaps.
o Onboarding, sometimes known as new employee orientation, is the process through which
organizations equip new employees with the knowledge and skills they need to succeed at
their jobs.
o Sales enablement is the strategic and cross functional effort to increase the productivity of
market-facing teams by providing ongoing and relevant resources throughout the buyer
journey to drive business impact. It encompasses sales training, coaching, content creation,
process improvement, talent development, and compensation, among other areas

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4.5.6. Benefits of Training

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4.5.7. Difference between Training and development

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4.6. Supply chain network (SCNet)

What Is a Supply Chain Network?
A supply chain is the network of all the individuals, organizations, resources, activities
and technology involved in the creation and sale of a product.
A supply chain network describes the movement of both materials & information, assessing
the programs and policies that impact the supply chain. Most business units in an organization
have an interest in efficient supply chain operations. A supply chain network design documents
these interactions, tracks improvements and sets long-term goals.
4.6.1. Features
• When an association of several businesses joins hands to produce finished goods from
raw materials and finally deliver it to the consumer is known as supply chain.
• Thus, with all the contributors this association is termed supply chain network.
• This network helps businesses to observe the movement of a product right from the
beginning till its finishing.
• It also ensures that the consumer receives the best product at the optimal price.
• The network of supply chain not only involves the flow of materials but also of the
• information.
• Businesses get linked to each other when they share valuable information which is
beneficial in serving the consumers.
4.6.2. Factor Handling the Supply Chain
During the recent times the supply chain network has progressed from being linear and
sequential process to extremely forceful process. It requires giving out visibility and real-
time updates among all in the network together with drawing out resolutions. All the
movements that surround the supply chain are handled by SCM, which is Supply Chain
Management. It is the dynamic combination and management of supply chain activities to
deliver satisfaction to the consumers. These counts for the attempts between all the
businesses of a supply chain both externally and internally
Why Are Supply Chain Networks So Important:
• Supply chain networks mostly manage the flow of consumer goods in our everyday
life. The professionals of the supply chain are skilled and experienced to face any sort
of unexpected situation.

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• They can work out the best feasible approach to deliver the necessary products to
the consumers. And, to do so they analyze the situation and accordingly take
productive steps.
• The supply chain network is very important for the majority of businesses which is a
great boost for the success of a business
4.6.3. The Working of Supply Chain

• Supply chain management (SCM) is the centralized management of the flow

of goods and services and includes all processes that transform raw materials
into final products.
• By managing the supply chain, companies can cut excess costs and deliver
products to the consumer faster and more efficiently.
• Good supply chain management keeps companies out of the headlines and away
from expensive recalls and lawsuits.
• The five most critical elements of SCM are developing a strategy, sourcing
raw materials, production, distribution, and returns.
• A supply chain manager is tasked with controlling and reducing costs and
avoiding supply shortages.
• A supply chain is the network of elements involved in different stages, from
upstream (supplier-end of the supply chain) to downstream (customer-end of
the supply chain), producing value in terms of products and services to the
ultimate customer.

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• Upstream deals with the raw material and other supplies as an input, while
downstream deals with the product and considers its transportation and
distribution

4.6.4. Definition of Supply Chain Management:

Supply Chain Management (SCM) is a series of interconnected activities related to the

transformation and movement of raw material to the finished goods till it reaches to the
end user. It is the outcome of the efforts of multiple organizations that helped in making this
chain of activities successful.

• These organizations may include the firms with whom the organization is currently
working like partners or suppliers, manufacturers, wholesalers, retailers, and
consumers. The activities may include integration, sourcing, procurement, production,
testing, logistics, customer services, performance measurement, etc.

• Supply Chain Management has a multi-dimensional approach which manages the

flow of raw materials and works in progress (semi-finished goods) within the
organization and the end product outside the organization till it reaches the hands of the
final consumer with a complete emphasis on the customer requirement.

4.6.5. Key Differences Between Logistics and Supply Chain Management:

• The following are the major differences between logistics and supply chain
management:
• The flow and storage of goods inside and outside the firm are known as Logistics. The
movement and integration of supply chain activities are known as Supply Chain
Management.
• The main aim of Logistics is full customer satisfaction. Conversely, the main aim
behind Supply Chain Management is to gain a substantial competitive advantage.
• There is only one organization involved in Logistics while some organizations are
involved in Supply Chain Management.

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• Supply Chain Management is a new concept as compared to Logistics.

• Logistics is only an activity of Supply Chain Management.

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4.6.6. Why Are Supply Chain Networks Important?

Modern supply chains help improve living standards by enabling consumers to buy essential
products at lower costs. This is because an effective supply chain streamlines theprocess of
getting products to market, and ultimately to consumers.
Some key reasons why supply chain management is important to include:
1. Basic life necessities. Through supply chain management, individuals access necessities
such as food and clothing, as well as life-saving medicines and health care products.
2. Power and light. People use electrical energy for homes and businesses for light, heat, and
air conditioning. The energy supply chain involves the transformation of raw materials
into usable energy and uses supply chain management principles to bring energy
resources to consumers.
3. Infrastructure. Interstate highway systems, railroads, ports, and airports facilitate the
exchange of goods between businesses and consumers.
4. Jobs. Supply chain management plays a critical role in job creation. Supply chain
professionals work in areas such as transportation, warehousing, inventory management,
packaging and logistics information
5. Boost Customer Service
• Customers expect the correct product assortment and quantity to be delivered.
• Customers expect products to be available at the right location. (i.e., customer
satisfaction diminishes if an auto repair shop does not have the necessary parts in stock
and can’t fix your car for an extra day or two).
• Right Delivery Time – Customers expect products to be delivered on time (i.e.,
customer satisfaction diminishes if pizza delivery is two hours late or Christmas
presents are delivered on December 26).
• Right After Sale Support – Customers expect products to be serviced quickly. (i.e.,
customer satisfaction diminishes when a home furnace stops operating in the winter and
repairs can’t be made for days)
6. Reduce Operating Costs
• Decreases Purchasing Cost – Retailers depend on supply chains to quickly deliver
expensive products to avoid holding costly inventories in stores any longer than
necessary. For example, electronics stores require fast delivery of 60” flat-panelplasma
HDTV’s to avoid high inventory costs.
• Decreases Production Cost – Manufacturers depend on supply chains to reliably
deliver materials to assembly plants to avoid material shortages that would shutdown
production. For example, an unexpected parts shipment delay that causes an auto
assembly plant shutdown can cost $20,000 per minute and millions of dollars per day
in lost wages.
• Decreases Total Supply Chain Cost – Manufacturers and retailers depend on supply
chain managers to design networks that meet customer service goals at the least total
cost. Efficient supply chains enable a firm to be more competitive in the market place.
For example, Dell’s revolutionary computer supply chain approach involved making
each computer based on a specific customer order, then shipping the computer directly
to the customer. As a result, Dell was able to avoid having large computer inventories
sitting in warehouses and retail stores which saved millions of dollars. Also, Dell
avoided carrying computer inventories that could become technologically obsolete as
computer technology changed rapidly
7. Improve Financial Position
• Increases Profit Leverage – Firms value supply chain managers because they help
control and reduce supply chain costs. This can result in dramatic increases in firm

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profits. For instance, U.S. consumers eat 2.7 billion packages of cereal annually, so
decreasing U.S. cereal supply chain costs just one cent per cereal box would result in
$13 million dollars saved industry-wide as 13 billion boxes of cereal flowed through
the improved supply chain over a five year period.
• Decreases Fixed Assets – Firms value supply chain managers because they decrease
the use of large fixed assets such as plants, warehouses and transportation vehicles in
the supply chain. If supply chain experts can redesign the network to properly serve
U.S. customers from six warehouses rather than ten, the firm will avoid building four
very expensive buildings.
• Increases Cash Flow – Firms value supply chain managers because they speed up
product flows to customers. For example, if a firm can make and deliver a product to
a customer in 10 days rather than 70 days, it can invoice the customer 60 days sooner

4.6.7. Categories of Supply Chain :

There are two types of the supply chain: -

• The Push Model- is the marketing-oriented approach. The inventory is generated as per the
authentic demands.
• The Pull Model- which is the customer-oriented approach. According to this approach, the
consumer placed the first order. After that only the ordered product production start.
• Push and pull strategy refer to two different approaches to managing the flow of goods in
a supply chain management.
• A push strategy aims to keep products in stock even before the customers order them.
• A pull strategy produces goods in accordance with the demand of the customers.
• While Coca-Cola uses a push strategy, companies like Toyota use a pull strategy in supply
chain management.

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• There are many similarities between push and pull strategies, including their goal and
need for flexibility.
• The differences between the two range from lead time to inventory management.
• In real life, most businesses like Amazon use a mix of both push and pull strategies.
• Push and pull strategies in supply chain management are two distinct approaches to
managing the flow of products from manufacturers to consumers. Both pull and push
strategies have their own advantages and disadvantages.
• key factors to ensure that you choose the right strategy that matches your business
needs:
Product characteristics
• You should choose between a push or pull strategy considering the nature of the product
that you are selling. You should keep the product characteristics in mind, like its shelf life,
demand predictability, and variability.
Cost structure
• You must determine the cost structure of your business before choosing between a push
or pull strategy. Do you want to minimize upfront costs? Can you risk the cost of
overproduction? Push strategies have higher upfront costs. Meanwhile, pull strategies have
lower upfront costs.
Market Conditions
• Before choosing between a push or pull strategy, it is important to understand the target
market condition and customer preferences. You must monitor customers’ purchasing
behavior and demand patterns.

4.6.8. Types of Supply Chain

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4.6.9. What Is Supply Chain Modeling?

Supply chain modeling is designing and analyzing a supply chain to identify potential
improvements. A supply chain model can be used to simulate different scenarios to
determine the most efficient or practical course of action.

There are many supply chain models, including static, dynamic, and Monte Carlo simulation
models. The most appropriate model for a particular situation depends on the certain goals and
constraints of the business.

Some of the benefits of supply chain modelling include:

• Reduced costs
• Increased efficiency
• Improved customer satisfaction

4.6.10. Major Components of Supply Chain Modeling

1. Inventory: This is the most critical component of supply chain modeling as it directly
affects the bottom line.
2. Transportation: This includes all modes of transportation such as road, rail, air and
water.
3. Warehousing: This is important for finished goods as well as raw materials. It
includes storage, retrieval and packaging.
4. Manufacturing: This converts raw materials into finished products. It includes
processes like assembly, testing and quality control.
5. Procurement: This involves sourcing raw materials and components from suppliers.
It also includes contract negotiation and management.
6. Distribution: This covers the delivery of finished products to customers through
wholesalers, retailers or direct sales channels.

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7. Customer Service: This comprises activities like order taking, invoicing, returns
processing and after-sales service.
8. Information Technology: IT is critical in all aspects of supply chain management,
from planning to execution.

4.6.11. Types of Supply Chain Models

The Continuous Flow Model

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• The continuous flow model is built around efficiency. It offers stability in high- volume
environments. This classic model is best suited for manufacturers who produce the
same product repeatedly, with little design fluctuation or alteration.
• This model is ideal for commodity manufacturing. Its high level of efficiency is
reflected in low product prices. For manufacturers, margins are based on raw material
prices. That sounds like science to me.

The Fast Chain Model

• The fast chain model is built for responsiveness. It’s ideal for manufacturers who
change their product line frequently. This model is the best suited for trendy products
with short life spans. In this example, the manufacturer that can flood the market before
the trend cycle ends is the manufacturer that wins.
• This model emphasizes the competitive advantage of the first adopter. But the true
driver of the fast chain is the designer—and the marketing department. Put another way,
if you can create your own trend, you’ll be the first to market. In short, this model is
driven by art.
The Efficient Chain Model
• The efficient chain model is for hypercompetitive industries where end-to-end
efficiency is the ultimate goal. This model relies heavily on production forecasting in
order to properly burden and sweat machinery assets.
• The efficient model also relies heavily on commodity and raw material prices. In the
post-pandemic world, efficient chains are struggling with capacity issues. Drivers for
this are labor shortages, material shortages, and delays.
The Agile Model
• The agile model is ideal for manufacturers that deal in specialty items. This model is
finely tuned for small batches of product. That requires less automation and more
expertise. And that additional value-add in turn allows businesses using this model to
command higher prices.
• Agile-model businesses can ramp up volume. But past a certain volume threshold, they
typically prove uncompetitive. Compared with efficient-chain-model businesses, at
higher volumes agile businesses get blown out of the water from a pricing standpoint.
The Custom-Configured Model
• The custom-configuration model focuses on providing custom setups duringproduction
and assembly. Most often, this setup time occurs at the beginning of a lengthier
production and assembly run process. For example, certain prototype or limited-
production builds fall into custom-configured manufacturing.
The Flexible Model
• The flexible model tries to be the best of all worlds. It can react to high volume demands
during a peak season. Flexible model businesses can manage and absorb stretches of
low or no demand. This model is like a light switch. Flip it on or off as needed.
• To pull off the flexible supply chain model, a business requires the right tool (or
automated machinery) for the job. This model also requires a broad supplier network
or personnel who have a broad knowledge base.

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4.6.12. Supply chain analytics

Supply chains typically generate massive amounts of data. Supply chain analytics helps to
make sense of all this data — uncovering patterns and generating insights.
Supply chain analytics refers to the process’s organizations use to gain insight and extract value
from the large amounts of data associated with the procurement, processing and distribution of
goods. Supply chain analytics is an essential element of supply chain management (SCM).
An important goal of choosing supply chain analytics software is to improve forecasting and
efficiency and be more responsive to customer needs. For example, predictive analytics on
point-of-sale terminal data stored in a demand signal repository can help a business anticipate
consumer demand, which in turn can lead to cost-saving adjustments to inventory and faster
delivery.
How supply chain analytics works

Supply chain analytics brings together data from across different applications, infrastructure,
third-party sources and emerging technologies such as IoT to improve decision-makingacross
the strategic, tactical and operational processes that make up supply chain management. Supply
chain analytics helps synchronize supply chain planning and execution by improving real-time
visibility into these processes and their impact on customers and the bottom line. Increased
visibility can also increase flexibility in the supply chain network by helping decision-makers
to better evaluate tradeoffs between cost and customer service.

Features of supply chain analytics

Supply chain analytics software usually includes most of the following features:

• Data visualization. The ability to slice and dice data from different angles to improve
insight and understanding.
• Stream processing. Deriving insight from multiple data streams generated by, for
example, the IoT, applications, weather reports and third-party data.
• Social media integration. Using sentiment data from social feeds to improve demand
planning.
• Natural language processing. Extracting and organizing unstructured data buried in
documents, news sources and data feeds.
• Location intelligence. Deriving insight from location data to understand and optimize
distribution.
• Digital twin of the supply chain. Organizing data into a comprehensive model of the
supply chain that is shared across different types of users to improve predictive and
prescriptive analytics.
• Graph databases. Organizing information into linked elements that make it easier to
find connections, identify patterns and improve traceability of products, suppliers and
facilities.

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Types of supply chain analytics

A common lens used to delineate the main types of supply chain analytics is based on Gartner's
model of the four capabilities of analytics: descriptive, diagnostic, predictive and prescriptive.

1. Descriptive supply chain analytics uses dashboards and reports to help interpret what
has happened. It often involves using a variety of statistical methods to search through,
summarize and organize information about operations in the supply chain. This can be
useful in answering questions like, "How have inventory levels changed over the last
month?" or "What is the return on invested capital?"
2. Diagnostic supply chain analytics are used to figure out why something happened or
is not working as well as it should. For example, "Why are shipments being delayed
or lost?" or "Why is our company not achieving the same number of inventory turns
as a competitor?"
3. Predictive supply chain analytics helps to foresee what is likely to happen in the
future based on current data. For example, "How will new trade regulations or a
pandemic lockdown affect the availability and cost of raw materials or goods?"
4. Prescriptive supply chain analytics helps prescribe or automate the best course of
action using optimization or embedded decision logic. This can help improve decisions
about when to launch a product, whether or not to build a factory or the best shipment
strategy for each retail location.

Another way of breaking down types of supply chain analytics is by their form and function.
Advisory firm Supply Chain Insights, for example, breaks down the types of supply chain
analytics into the following functions:

• Workflow
• Decision support
• Collaboration
• Unstructured text mining
• Structured data management
Analytics applications in HR & Supply Chain

1. Hiring The Right Talent with Competency Acquisition Analytics

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• Hiring the right talent is instrumental to a company’s success with employees amounting
to one of the biggest costs and greatest opportunities in most businesses. Hence, in order to
study whether or not you are acquiring the right talent for your business, competency
acquisition analytics can be used.
• The primary step includes identifying the core competencies that are crucial for
the success of your business. Then, you can map these competencies against the
existing talent, their current capabilities and their potential for growth. Talent gaps,
if any, can also be identified at this stage.
• The HR team can assess whether the existing resources can be trained to plug the
identified competency gaps, or whether new talent with those competencies need
to be hired.
2.Recruitment Channel Analytics
• Just as important as hiring the right talent, is understanding where the best talent is
coming from. Recruitment channel analytics is a process that helps determine where an
organization’s best employees have been recruited from, and what recruitment channels
have been most effective in hiring the right resources for the company.
• This analysis includes gaining insights by drilling down into historical employee data,
surveys and feedback records and assessing KPIs such as the return per employee and
human capital value-added.
3. Classification Analysis to Determine the Success Rate of Teams
• Classification analysis is the process of analyzing historical data to identify patterns
that help us predict which category a particular observation or data entity belongs to.
In HR, this analytical method can be used to study the composition of a team, and other
context variables in order to determine how successful the team will be.
• Instead of forming teams merely on the experience, availability of resources,
organizations can use insights from classification analytics to understand what other
factors such as leadership style, team dynamics and size, the duration of a project, etc,
impact the success rate of a team. Being able to determine the success rate of a team
beforehand, enables organizations to form the right teams for a project.
4. Attrition Analysis
• High attrition is a huge challenge for HR teams and cost intensive for companies.
• Job postings, recruiting, onboarding and training are some significant expenses of
losing employees and replacing them.
• . One way to reduce attrition is by using advanced analytics and NLP to harness the
employee reviews data from employment websites like Glassdoor, Indeed, Comparably
etc. This analysis helps you measure the employee satisfaction towards the brand and
understand the common factors that lead to attrition.
5. Personalizing Training Programmes
• Instead of applying run-of-the-mill training methods and general programs for all
employees, the HR team can instead personalize courses to suit the learner’s preference.
• In order to do so, ‘adaptive’ learning technology must be used in which data analytics
determines the learning pace of the employee, the mode of training, as well as what
questions are best suited for them, in order to personalize the course to suit the learner.
6. Capacity Analytics and Utilization
• One of the major business benefits of advanced analytics in HR is in cutting down costs.
HR teams can use Capacity Analytics to determine:
o What the team capacity is and how much of it is actually being utilized.

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o What activities the team is engaged in when they are working.

o What processes, tools, and applications are being used to complete the work
and
o how much they cost the company.
o How operationally efficient the team is – helps determine if the team is either
overworked or underutilized.
• The capacity for growth.
7. Improving Employee Performance
• Although traditional methods of determining and managing employee performance
such as peer and manager review, monitoring KPIs, etc, are globally used, they have
not been very impactful in improving employee performance.
• In fact, a PwC report on Performance Management highlights that 52 percent of
organizations have made or are planning to make changes to employee performance
management in the near future.
• But with Employee performance analytics, individual employee performance can be
measured much more efficiently with the help of both historical and real-time data.
Employee performance analytics provides both a retrospective as well as a forward-
looking analysis of what employee performance was and how we can improve it. With
the resulting insights, we can identify the employees that are performing well and which
employees need additional training and motivation in order to perform better.
8. Anomaly Detection Analysis
• Anomaly detection analysis is used to recognize unexpected or deviant patterns. In
HR management, anomaly detection analysis can help identify relationships between
accidents at work and employees who are working longer working hours and possibly
fatigued. By identifying resources that work longer than a specified threshold, HR
teams could prevent accidents and injuries in the workplace.
4.6.13. Case study: Supply Chain Example: for apple juice production
• A supply chain network for an apple juice producer might consist of three sections:
Inbound Logistics
o This flowchart could show the Apple Grove->Apple Juice Plant->Apple Juice
Bottling Plant workflow.
o Further details would include a secondary/separate workflow for how the bottles
are made. This might include the oil field where the raw material is produced, the
tree plantation producing paper for the labels and various organizations involved
such as the label printer and paper manufacturer.
Internal Logistics
• This would include the organization distributing the apple juice to retailers and
grocery stores. This includes the company HQs and satellite locations.
External Logistics
• This would include the regional and national distributors and the shops selling the apple
juice.
• Developing a supply chain network allows companies to better understand theircurrent
supply chains and to document ideas for improvement that can be well-vetted prior to
implementation.
• Often organizations focus only on their organization; what they produce or provide and
not what the end customer receives. Looking at a supply chain network enables firms
to look at the overall movement of materials/information from start to end, allowing
organizations to see the value in creating partnerships; and the value in working
together to ensure the best possible value is provided to the end-customer.

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• Supply chains and supply networks both describe the flow and movement of materials
& information, by linking organizations together to serve the end-customer.
Network’ describes a more complex structure, where organizations can be crosslinked
and there are two-way exchanges between them; ‘chain’ describes a simpler, sequential
set of links
• In order to understand a supply chain network; we need to understand what a
supply chain is. A supply chain is a series of processes linked together to form a chain

• The above diagram is an example of a simplified supply chain; the supply chain
shows the movement of material flow from the Apple farm right through the production
process to the end users
• A supply chain network shows the links between organizations and how information
and materials flow between these links. The more detailed the supply chain network the
more complex and web like the network becomes.
• The above example demonstrates a simplified version of a supply chain network of an
Apple Juice organization. The organization will have an upstream network and a
downstream network

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Organizations are linked via two types of flows:

• To get a complete picture of an organizations supply chain network; information &
material flow should be mapped. Inefficiency can then be located and removed.
• Material flow: Is the movement of goods from raw primary goods (such as Wool,
Trees and Coal etc.) to complete goods (TV’s, Radios and Computers) that are to be
delivered to the final customer.
• Information flow: Is the demand from the end-customer to preceding organizations
in the network
Supply Chain Network: Information flow, Flow of Materials
• If a focal firm provides their suppliers with their sales data/ forecasting demand
information; their supplier will be able to reduces costs (such as over production waste)
and improve prices.
• In order to better serve your end customer, it is important to develop strong partnerships
within your supply network which has a flow on effect to your end customers whether
you are a manufacturer, distributor or retailer. Better communication will increase
efficiency and productivity. Trust is the core ingredient to developing better
communication and relationships.

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4.6.14. Supply Chain Drivers

The capabilities of your supply chain are determined by the decisions you take in response to
supply chain drivers, but equally each of these drivers can be developed and managed to
emphasize effectiveness or efficiency, depending on changing business and economic
requirements.

The 7 consumer drivers of supply chains

Consumer drivers center on ultimate customer satisfaction. Response times, accuracy, delivery
promptness, shipment specifications, tracking, and communication is key. These drivers
translate into your capabilities within the supply chain, and can be summarized as:

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The 5 classical drivers of supply chains

There are five classical drivers that provide a useful framework for adjusting your supply chain
capabilities. Decisions made about how each driver operates will determine the blend of
responsiveness and efficiency a supply chain is capable of achieving.

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1. PRODUCTION
• Keep production effective by ensuring factories that have maximum capacity and use
flexible manufacturing techniques to produce a wide range of items. Alternatively,
companies can do their production in multiple, smaller plants, close to major
distribution center’s / customers so delivery times can be expedited.
• If efficiency is desirable, then companies can build factories with minimal excess
capacity, and optimize factories to produce a limited range of items. Gain further
efficiency by concentrating production in large, central plants to get better economies
of scale, accepting that delivery times might be slightly longer for production gains.
2. INVENTORY
• Decisions about inventory are simulated by setting production rates and delivery
schedules for products, and by defining on-hand amounts for different products at
facilities throughout the supply chain.
• Effectiveness can be ensured by stocking high levels of inventory for a wide range of
products, as well as by stocking products at multiple locations - this means your
inventory is both close to customers, and immediately available.
3. LOCATION
• A location decision that emphasises the effective would be one where a company
establishes many locations that are close to its customer base. For example, fast-food
chains use location to be very responsive to their customers by opening up lots of stores
in high volume markets.
• Efficiency can be achieved by operating from only a few locations and centralising
activities in common locations, such as the way e-commerce retailers serve large
geographical markets from only a few central locations that perform a wide range of
activities.
4. TRANSPORT
• Effective transportation modes are fast and flexible, such as trucks and airplanes. Many
companies that sell products through catalogs or on the Internet are able to provide high
levels of responsiveness by using transportation to deliver their products often within
48 hours or less.
• Efficiency can be met by moving products in larger batches, less often, with slower but
bulk carriers such as ship or railroad. Transportation can also be made more efficient if
it originates out of a centralized distribution center as opposed to multiple separate
branches.
5. DATA
The power of information grows stronger every year as the technology for collecting and
sharing information becomes more accessible, affordable, and easier to use. Data is like money
- it is a valuable commodity because it can be applied directly to make decisions that enhance
the performance of the other supply chain drivers.

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Outcome of Supply Chain Networks

The primary objectives of Supply Chain Management are
• to ensure efficient and cost-effective production,
• timely delivery of products and services,
• effective inventory management,
• collaborative relationships between suppliers and customers, flexibility, and
• responsiveness to changes in demand.

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Supply Chain Networks optimization

• Supply chain optimization refers to the tools and processes by which

manufacturing and distribution supply chain performance and efficiency are
improved, taking into account all constraints. Supply chain network optimization
technologies use sophisticated algorithms and analytics to balance supply and
demand in such a manner that sufficient raw materials are procured for
manufacturing and distribution to meet customer expectations at the highest cost
efficiency
• A supply chain is a network of organizations, individuals, activities, information, and
resources involved in the production and sale of a service or product to consumers. The
chain begins with the transformation of natural, raw resources and components into a
finished product or service, and concludes with the delivery of that product or service
to the end customer.
• The supply chain network design and optimization process enables businesses to
maximize gross profits, minimize operating expenses, and ultimately create a
successful customer experience that provides customers what they want, when they
want it, where they want it, and at the lowest cost and highest profit, balancing the costs
of distribution, inventory, manufacturing, and transportation.

• Supply chain design optimization: focuses on warehouse locations, product flows

within the warehouse facilities network, manufacturing schedules, and demand
planning

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• Supply chain planning optimization: determines how to manufacture and distribute

products and/or services in a way that will balance supply and demand, and meet the
forecast demand at the highest profitability
• Supply chain execution optimization: focuses on global trade management, inventory
management, order management systems, real-time decision support, supply chain
visibility, and transportation management
• Supply chain optimization software solutions are capable of forecasting, balancing
supply and demand, organizing and managing inventory and deliveries, and managing
supply chain design, supply chain planning systems, and execution on a granular level.
Inventory and supply chain optimization solutions are integrated into replenishment
systems distribution requirements planning in order to seamlessly and precisely
maintain the model stock profile in real-time.
• Supply chain network optimization tools include sophisticated optimization algorithms,
which are capable of accounting for load and unloading rules, load stability regarding
decreasing transportation costs, palletizing logic, stackability constraints, and
warehouse efficiency. Standard Deviation and Mean Absolute Deviation techniques
may be applied to determine the amount of additional stock that should be maintained
in inventory to mitigate risk of material shortfalls caused by unpredictable demand.
• Modern supply chain optimization technologies typically provide a platform on which
supply chain managers and supply chain optimization analysts gain real-time end-to-
end visibility of supply chain operations; standardize, synchronize, and automate
business processes and execution; and leverage machine learning capabilities and AI
for supply chain optimization.
Advantages of supply chain network architecture optimization may include:
• reduced surplus inventory
• lower logistics cost levels
• improved customer service due to better forecasting and improved availability
• reduced time to act on supply chain issues and respond to market disruptions
• simplified supplier onboarding and collaboration
• decreased lead times
• reduced time, total cost, and risk associated with qualifying and managing new
suppliers
• better resiliency, agility, and predictability in mitigating risks and maintaining
business continuity
4.7. Planning Demand, Inventory and Supply

What is Demand Planning?

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Demand planning is a supply chain management process of forecasting, or predicting, the

demand for products to ensure they can be delivered and satisfy customers. The goal is to strike
a balance between having sufficient inventory levels to meet customer needs without having a
surplus. A wide variety of factors can influence demand, including labor force changes,
economic shifts, severe weather, natural disasters or global crisis events

4.7.1. What are the Aspects of Demand Planning?

Demand planning spans several aspects, with the three primary areas being:

1. Product Portfolio Management

Product portfolio management oversees the overall product lifecycle, beginning with the
introduction of a new product through to its end-of-life planning. In many cases, product lines
are interdependent, and understanding how new products may influence demand for
other products is important to understanding the overall product mix required to maximize
market share.

2. Statistical Forecasting

Using historical data, statistical forecasting creates supply chain forecasts with advanced
statistical algorithms. In this area, it is important to determine the accuracy of each model,
identify outliers and exclusions and understand assumptions. Seasonal shifts (think the spurt
of holiday shopping that occurs between October and December for retailers, or the boost in
yard equipment sales in spring months) can also be assessed with statistical forecasting.

3. Trade Promotion Management

Trade promotion or marketing events can influence demand, especially in the retail industry.
The goal of a trade promotion is to help a brand connect with a customer, often through an in-
store giveaway, discount, or promotion, and these events can impact the demand for aproduct.

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4.7.2. Demand Planning Functions

You must ensure that the members of the cross-functional demand planning function
team have clearly defined responsibilities and roles. The representatives of supply
Team Creation chain and purchasing groups can ensure that the business has sufficient inventory so
that they can accomplish the demand predictions.

Different employees who are included in the demand planning function agree on
Aggregation and the data that is involved in the creation of the forecast. The related data differs by
definition of the company. It includes sales data by location and channel, inventory turnover, out-of-
internal data stock rates, production times, lead times, obsolete inventory, and different crucial
inventory metrics.

Use of external External data happens to be a crucial input to enhance the effectiveness of the
demand planning function. It happens to be metrics for the supplier’s delivery
data to increase timelines, the latest performance, and the most updated purchasing habits of the
forecasting potential audien

Creation of the It is important to determine the kind of forecasting model that will be most beneficial
statistical to the business before you start creating it. You can do it with the use of demand
demand planning software. Although a few businesses use Excel and other tools that require
forecast manual work, they are prone to errors.

Challenging It is necessary to review, refine, and reanalyze the demand forecast with the crucial
stakeholders. After this, you should add the latest data to check whether it has a
demand substantial impact on the predictions. The questions of incorrectness will remove the
forecast outliers, which will distort the forecast to understand the impact to do so.

You need to determine the amount of inventory necessary to accomplish the cycle
Weighing the inventory or predicted demand. Also, you should recognize the necessary vendors
forecast against to accomplish the demand, after which you should check with them, thereby ensuring
the inventory that they will deliver the prerequisite services and products within the necessary
timeline.

In this step, you should recognize the KPIs, or key performance indicators, which
will allow you to measure the demand planning function effectiveness, thereby
Measuring the setting the targets. Moreover, you should make sure that the business is tracking the
results sales forecast accuracy, fill rates, inventory turns, cost of goods sold, and order
fulfillment lead times

4.7.3. Why is Demand Planning Important?

If product isn’t available for customers to purchase because it’s out of stock, businesses lose
out on revenue, and over time, they could lose the customer to a competitor. On the other hand,
sitting on a slew of unused inventory incurs both space and production costs unnecessarily.
With demand planning, business leaders can stay in front of market shifts and make more
proactive decisions, while being responsive to their customers’ needs.

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4.7.4. Best Practices for Demand Planning

Demand planning is a multi-step process, dependent on the right tools, information and
processes. Often, there can be unique nuances in the process, based on product positioning,
inventory needs and organizational goals, but some best practices to keep in mind include:
Implement the Right Software
There is a plethora of options when it comes to enterprise resource planning (ERP) systems, so
choosing the right one can be tricky. When considering ERP software, it’s important to
examine the ability of the tool to handle forecasting nuances as well as the provider’s
reputation, reporting capabilities, and the transparency and reliability of the forecasts it
produces.
Gather and Prepare Data
Data drives demand planning, now more than ever. Real-time visibility into inventory
movements coupled with metrics reports that paint a clear picture and data mining and
aggregation that can identify areas for improvement or reaction can help to create more
agile process modelling.
Define Process Models
For most companies, the steps in the demand planning process go something like this:
• Preparation of data
• Initial forecasting
• Incorporation of market intelligence
• Consideration of sales goals and financial reports to reconcile bottom-up forecasts
with top-down financial and sales forecasts

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• Refine a final forecast

• Performance monitoring based on real-time analytics
Implement and Monitor
Successful demand planners usually design a pilot version of the plan using historical data, or
descriptive analytics, as a basis. They also make regular adjustments and have a team of people
dedicated solely to devising the plan, implementing it, reducing error and bias, and designing
processes for execution.

How Demand Planning Can Improve the Supply Chain

To maximize profitability, supply chains need to be as efficient as possible. Accurate demand

planning is critical in ensuring supply chains are efficient for inventory and, ultimately,
revenue.

The Future of Demand Planning in the Supply Chain

Like many business needs, supply chain and demand planning are going digital. Advances in
applications of machine learning within the supply chain are making it possible to adapt and
update forecasts in real time, allowing inventory to run leaner, without missing the mark on
demand.

For supply chain professionals, understanding how to use digital enterprise architectures and
implementing artificial intelligence and machine learning programs that can help optimize a
lean, agile and data-driven approach will reveal new ways to cut costs in operations, boost
revenue and offer a greater competitive edge.

A better-connected supply chain means demand planning can be conducted even more in the
moment. When implemented well, demand planning can be a pivotal process in boosting a
supply chain’s profitability.

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4.7.5. Inventory and supply chain management methods

Inventory and supply chain management are the major component of business strategy
and profitability. Without them, companies cannot manage their inventory effectively
and can incur additional costs.
The increase in costs can be incurred with increased warehousing requirements or lost
revenues due to dead stock. Human and financial resources dedicated to inventory
management can also represent a significant expense.
Poor inventory and supply chain management can hurt a company's profitability
through the strain that inefficient inventory puts on its cash flow. It can also lead to
dissatisfied customers, who may seek alternative suppliers as a result of the continual
unavailability of certain products.
Adopting an optimal inventory management strategy designed for your specific
challenges is essential in reducing costs and risk, and more importantly, ensuring the
long-term future of your business.
Good inventory management will allow you make better decisions. It will also give you
the ability to be more responsive to customer demand and ever changing market needs.
I. Inventory and supply management: definitions
1. Inventory management strategies
To choose the best inventory and supply chain management method, there are two
options available:

• an empirical strategy

• a forecast strategy

An empirical inventory management strategy is based on sales history. By

establishing the average sales of each unit, their frequency of removal from stock and
any consumption peaks, it is possible to anticipate the future requirements. An
empirical strategy is based on what has happened in the past.

A forecast strategy also takes into account sales history, but includes macro
influences – those that take place outside of the company: things like market and sector
trends, changes in consumer behaviour, etc.

2. Inventory and supply management - what is it?

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• Inventory management refers to the methods and practices used to

determine the quantities and frequency of purchases of a company's
products.

• The aim of this set of measures is to establish the best compromise between
storage and delivery costs, in order to be able to meet market demand.

• To be effective, inventory management involves documented tracking of

products (quantity, location, condition, etc.)

• Supply is what keeps the chain moving. It can be anything from providing the
company with the raw materials and/or goods in order to guarantee products are
made, to the movement of products through the various phases of distribution.

• Supply can occur in different places: the warehouse, a manufacturing plant or

even at point of sale

II. Why optimize the inventory and supply management method?

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1 - To avoid overstocking

• Overstock is dormant products that don't bring any profit to a business and
cost a business money (through warehousing costs).

• These products are effectively tied up capital that cannot be mobilised to create
value, and in turn increase costs which is a real disaster!

• A company must try to avoid overstocking at all costs, because the negative
effect it places on cash flow, increases the Working Capital Requirement
(WCR) and reduces its margin of safety.

2 - Avoiding low stock and out of stock

• If you have insufficient products to meet the potential demand of your

customers, the risk of out of stock is increased.

• This is a situation that must be avoided, because it means a temporary halt to

your business.

III - 7 methods of inventory and supply chain management

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1. The ABC analysis of stock

• The ABC analysis of stock is a method of separating your products into 3 classes to
determine their importance.
• Class A: 10 to 20% of products representing 80% of the total revenues. These are the
most important products. Breakage is not an option and inventory monitoring must be
rigorous and regular
• Class B: 30 to 40% of the products which represent 15% of the total revenues. These
are intermediate products and it is advisable to monitor these regularly, to always ensure
products are available.
• Class C: 50% of products that represent 5% of the total revenues. These products
require less frequent replenishment. Replenishment is only needed when all the stock
has been sold, in order to minimise storage costs.
2. EOQ Model
• Economic Order Quantity is a technique utilized for planning and ordering an order
quantity. It involves making a decision regarding the amount of inventory that should
be placed in stock at any given time. The order will be re-ordered once the minimum
order has been reached.
3. FSN Method
• This method of inventory control refers to the process of keeping track of all the items
of inventory that are not used frequently or are not required all the time. They are then
categorized into three different categories: fast-moving inventory, slow-moving
inventory, and non-moving inventory.
4. JIT Method
• Just In Time inventory control is a process utilized by manufacturers to control their
inventory levels. This method saves them money by not storing and insuring their
excess inventory. However, it is very risky since it can lead to stock out and increase
costs.
5. Minimum Safety Stocks
• The minimum safety stock refers to the level of inventory that an organization
maintains to avoid a possible stock-out.
6. MRP Method

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• Material Requirements Planning is a process utilized by manufacturers to control the

inventory by planning the order of the goods based on the sales forecast. The order is
usually based on the data collected by the system.
7. VED Analysis
• VED is a technique utilized by organizations to control their inventory. It mainly
pertains to the management of vital and desirable spare parts. The high level of
inventory that is required for production usually justifies the low inventory for those
parts.

4.7.6. Four ways of ensuring more efficient supply chain inventory management

1. Maintain alternative suppliers for your core business

• Having alternative suppliers spread across geographies is a great way to ensure that the
supply of essential goods for your business remains uninterrupted. While this maynot
seem extremely efficient, it certainly helps mitigate risks from black swan events.

• Another step is to maintain reserve or safety stocks to prevent operations fromgrinding

to a halt completely.

• Car manufacturer Volkswagen has regional supply chains in China and Europe. When
the pandemic affected Volkswagen’s supply chain in China, the company switched to
its European suppliers and then switched back to China again when the pandemic shut
down Europe, according to the survey report.

2. Re-evaluate your sourcing strategies and suppliers

• In the survey, 44% of respondents believed their companies relied too much on
suppliers from some countries. In the future, they would prefer securing suppliers
from a wider range of countries, and possibly near-shore alternatives.

• More businesses are evaluating sourcing strategies that involve local suppliers and
greater transparency to build resilient supply chains that can be monitored more closely.

• Some, like Schneider Electric, are planning to cut down their suppliers by half —
from 12,000 to 5,000 by 2022-23 — to work closely with a select number of suppliers,
according to the report.

3. Embrace technology and digital transformation of your supply chains

• The survey reported that less than 40% of the companies have adopted digital platforms
and advanced analytics, with less than a third using the cloud or IoT. That must change
for inventory management to be effective.

• Advanced inventory and warehouse management software can help companies tap in
to real-time data for better visibility and more accurate forecasting. AI and advanced
analytics can help companies track crucial metrics, such as inventory turnover, gross
margin, and customer order fill rate and improve overall supply chain

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4. Become less siloed and more collaborative as an organization

• The goal of effective supply chain inventory management is to guarantee that the right
goods are in the right place at the right time. Isolated departments and siloed
organizational data reduce the transparency needed to ensure effective inventory
management. That’s why facilitating a smoother flow of information across
departments is the key.

4.7.6. 3 Main Roles of Forecasting in Supply Chain Management

Forecasting plays three major roles in effective supply chain management:

• Pivotal in strategic planning of Business: Forecasting is the underlying hypothesis

for strategic business activities like expansion planning, budgeting, financial planning,
risk assessment, and mitigation. Critical business assumptions like turnover, profit
margins, cash flow, capital expenditure, etc. are also dependent on Forecasting.
• Initiating all push–processes of Supply Chain: Forecasting is the starting point for
all push-processes of Supply Chain like raw material planning, purchasing, inbound
logistics, and manufacturing. Better forecasts help optimize the inventory levels and
capacity utilization.
• Driving all pull–processes of Supply Chain: Forecasting drives all pull-process of
Supply Chain like order management, packaging, distribution, and outbound logistics.
Better forecast improves the distribution and logistics and increases customer service
levels.

4.8. Logistics

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• Supply chain management (SCM) is one of the main ways to optimize the budget
of enterprises producing goods and/or services. At the same time, a great role in
the supply chains is played by logistics – the management of physical,
informational, and human flows in order to optimize them and avoid unnecessary
waste of resources.
• Logistics is an aspect of the supply chain that stores or delivers finished goods or
services to the customer, whether that's a manufacturer, distributor or consumer.
The goal of logistics is to get goods and services to the customer on time and at a
competitive price

4.8.1. Definition of Logistics Management

• The management process which integrates the movement of goods, services,

information, and capital, right from the sourcing of raw material, till it reaches its end
consumer is known as Logistics Management.
• The objective behind this process is to provide the right product with the right quality
at the right time in the right place at the right price to the ultimate customer. The logistic
activities are divided into two broad categories they are:
1. Inbound Logistics: The activities which are concerned with procurement of material,
handling, storage and transportation
2. Outbound Logistics: The activities which are concerned with the collection,
maintenance, and distribution or delivery to the final consumer.
Apart from these, other activities are warehousing, protective packing, order
fulfillment, stock control, maintaining equilibrium between demand and supply, stock
management. This will result in savings in cost and time, high-quality products, etc.

4.8.2. Role of Logistics in Supply Chain Management

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In supply chain management, logistics are responsible for the movement and storage of goods
and services, along with the documents and reports that record those movements throughout
an item’s journey to the customer.

Logistics include the numerous transportation methods that get inventory from one location
to another. This component is responsible for figuring out where goods can be kept at each
stage until they’re needed at another location, which is essential to effective supply chain
management.

Why Logistics Are So Important to Supply Chains

Logistics are a critical piece of supply chains because it manages and tracks the people and
resources needed to store and transfer goods and services. Logistics ensure that materials and
products reliably move at the right time and on budget.

Specific aspects of logistics that support supply chains include:

• Delivering the right products at the right time.

• Reducing costs and improving efficiency.
• Helping retain customers and increasing loyalty.
• Providing a unique value proposition for some businesses.
• Providing a means to deliver goods from the most cost-effective location for
production to the location of the customer.

Why Is Logistics Training So Important to Supply Chains?

The field of logistics is constantly evolving as customer trends change. Logistics training helps
employees and their companies stay current with best practices. Training gives a company the
tools it needs to analyze and improve customer demand, product design and distribution
strategies.

Why Use Logistics and Supply Chain Management?

Logistics and supply chain management help businesses stay competitive. These practices track
and coordinate the efficient and cost-effective movement of goods and services, whichis key
to an organization’s profitability.

The Role of Logistics within Supply Chain Management

Supply Chain Logistics
Planning “Information Inventory control”
Sourcing “Information Material handling Transportation”
Manufacturin “Information Material handling Storage Warehousing
g Packaging/Unitization Transportation”
Delivering “Information Warehousing Inventory management Materials-handling
Packaging Transportation”
Returning “Information Packaging/Unitization Material handling Transportation
Warehousing”

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The Differences Between Supply Chain Management and Logistics

Logistics Supply Chain

Logistics is one activity in Supply chain management covers a wide range of
supply chain management. activities, including planning, sourcing materials, labor
and facilities management, producing and delivering
those goods and services.
Logistics focuses on the Supply chain management targets higher operational
efficient and cost-effective performance that will give the business a competitive
delivery of goods to the advantage.
customer.
Logistics started with the The modern practice of supply chain management started
military. Many say Alexander in the 20th century. The Ford Motor Company production
the Great, born 356 B.C., as a lines perfected the concept. Many credit logistician Keith
logistics master. Oliver as the person who coined the term in the early
1980s.
Logistics are centered on the SCM oversees the development of raw materials into
movement and transport of finished goods that move from the producer to the
goods within a company manufacturer. Those goods get distributed to retailers or
directly to consumers.

4.8.3. The Functions of Logistics within Supply Chain Management

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1. Processing Orders
A critical part of logistics functions is order processing. There are various ways to submit an
order, such as through mail, telephone, salespeople, or computers. However, orders must be
processed as soon as they are received. Business organizations and customers both reap the
benefits of efficient order processing. Some major order processing activities include the
following:
• Checking the order for any changes in negotiated terms.
• Payment and delivery terms.
• Checking the availability of stock.
• Production and material scheduling to cater to shortages.
2. Transportation
• Transportation is the most crucial and essential function of logistics in supply chain
management since it allows items to move from the provider to the buyer. When a
customer places an order, the purchase is not complete until the products are physically
delivered to their location. Transportation consumes 60 to 70% of logistics costs,
particularly for low unit-priced and mass-consumed products. Varioustransportation
modes are used to physically move items, such as rail, truck, water, and air.
3. Managing Inventory
• Inventory management is one of the most important logistical functions that is also
considered the worst offender in a company's entire supply chain because of its high
carrying cost, which eats into profits indirectly. It includes costs such as inventory
funding, security, warehousing, damages, repairs, and thefts.

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• Inventory management is all about having enough inventory on hand to meet customer
requirements while keeping carrying costs low. It's a delicate balancing act between
offering exceptional customer service while minimizing market share loss and the
associated costs.
4. Warehousing
• The storage of finished items until they are delivered is known as warehousing, which
is significant to a company's logistics functions. The right warehousing decisions
determine the efficacy of a company's marketing.
• With the recent developments in technology, warehousing has improved significantly.
Single-storied automated warehouses have replaced older multi-storied warehouses
with a limited number of employees.
• In logistics, warehousing is a critical decision area. With right and modern
warehousing, you can reduce labor costs and have greater inventory control.
5. Packaging
• Packaging is a critical element of logistics management functions. It impacts the
effectiveness of the logistics system by influencing the physical flow of a product. It's
not the same as package design, which is focused on marketing goals.
• However, logistical packing is necessary for breakage prevention, handling of
materials, and storage space efficiency. In terms of packing cost, load utilization
significantly impacts logistical packaging.

6. Handling Materials and Storage

• Material handling is considered influential among other logistical functions because it
affects how inventory moves along the distribution chain. Product breakage, delivery
delays, and incidental overhead expenses will increase because of incorrect material
handling.

• Advanced manufacturing technologies and material handling increase the efficiency

of the logistics system. The numbers to be managed, the speed necessary for material
transportation, and the degree of service to customers are all factors to consider when
choosing a material handling system.
• The storage system is critical for maximum space utilization in a warehouse of a
particular size. For quick movement (holding and retrieving) of items to and from the
warehouse, the supply chain strategy should work in tandem with the storage system.

7. Monitoring
• Businesses must keep inventory control, transport, and warehousing all up to date.
Each site needs to know about its present supply chain situation, future obligations,
and restocking capacity regularly.
• Similarly, a company must study the various means of transportation available, their
prices and appropriateness for services and additional features before choosing a
carrier. Storage space, labor schedules, order demands, and delivery must be monitored
and tracked. Also, businesses can enhance their efficiency by keeping a check on
services and reviewing total delivery efficacy.

4.8.4. Challenges Logistics Helps to Overcome in Supply Chain Management

• Given the above list of tasks that logistics performs in supply chain management, we
can single out a number of advantages provided by its correct implementation:

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• Minimization of enterprise expenses. The main role of logistics in supply chain

management is primarily to increase the overall value of each delivery, which is
identified by customer satisfaction. This means that the reduction and optimization of
labor resources must be tied in with keeping up a certain level of quality customer
service. This problem is solved both by reducing the total labor resources (primarily by
eliminating unnecessary chain links), and by introducing automation solutions;
• Consolidation of traffic volumes. Transportation costs are one of the largest expense
categories in logistics management. In general, transportation costs increasedepending
on the distance, batch size, and product exposure to damage. On the other hand, the
transportation cost per unit of weight decreases as the lot size increases on long runs.
Thus, the maximum consolidation of transportation volumes can help reduce
transportation costs. Enlargement can be achieved by combining small lots into a single
large one, intended for a long run (i.e., for a longer distance);
• Improving the quality of service. With regard to the quality of service, it is largely
influenced by the speed of delivery of the goods to the end-user, as well as its
transportation in proper conditions (for example, many products today are supplied with
RFID tags so that both the manufacturer and the end customer could track whether all
storage conditions are being observed during the transportation of the goods) and within
the allowed time limits (this refers primarily to perishable goods);
• Reduction of actual losses and reduction of possible risks. As you know, a business
is profitable if the value it creates exceeds the costs associated with theimplementation
of activities. To achieve a competitive advantage, a company must either carry out these
activities at lower costs or carry them out in a way that will lead to differentiation and
price increment. The first thing to be done to effectively solve this problem is reducing
the losses that are associated with the return of goods. It is very important to plan not
only the routes on the way to the distributor or the enduser but also the routes by which
the goods are delivered back to the warehouse or to the establishments for their disposal.
The second factor affecting risk reduction is the correct planning of enterprise
resources, which minimizes the likelihood of damage orloss of goods or manufacturing
components on the way from the extraction of raw materials to delivery of the finished
product/service to the end-user;
• Minimization of the need for intermediary services. Intermediary services
(transportation, storage, marketing, recycling, etc.) take up the lion’s share of the cost
of the implementation of supply chains. Experienced logisticians plan routes so as to
minimize the need for involving third-party services for efficient logistics management;
• Supporting goods with the necessary documentation. Insurance and support of
documentation are two fundamental tasks of logistics, solving which helps to eliminate
any problems associated with legal restrictions in the storage, transportation, and
marketing of goods;
• Timely response to changing market demands. Advanced logistics scenarios also
help to quickly adapt to changing market requirements and, thereby, maintain top
positions against the backdrop of competitors and remain in demand for the target
audience.
Why Is Logistics Management Important?
• Logistics Management can be reduced to the fundamentals of the most efficient and
effective ways to move resources and products to the customer. This ultimately

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provides the best service to customers who are ever demanding faster and more
efficient services.
• Logistics management is also able to create visibility within an organization's
supply chains, provide data on real-time movements and therefore advise on and
implement change that directly affects the organization as a whole.

• Logistics Management forms a core part of a supply chain for any organization,
managing and overseeing the distribution network to ensure that inventory
management is under control.

4.9. Analytics applications in HR & Supply Chain:

a. Hiring The Right Talent With Competency Acquisition Analytics:

• Hiring the right talent is instrumental to a company’s success with employees

amounting to one of the biggest costs and greatest opportunities in most businesses.
Hence, in order to study whether or not you are acquiring the right talent for your
business, competency acquisition analytics can be used.
• The primary step includes identifying the core competencies that are crucial for the
success of your business. Then, you can map these competencies against the existing
talent, their current capabilities and their potential for growth. Talent gaps, if any, can
also be identified at this stage.
• The HR team can assess whether the existing resources can be trained to plug the
identified competency gaps, or whether new talent with those competencies need to
be hired.

b. Recruitment Channel Analytics

• Just as important as hiring the right talent, is understanding where the best talent is
coming from. Recruitment channel analytics is a process that helps determine where an
organization’s best employees have been recruited from, and what recruitment channels
have been most effective in hiring the right resources for the company.
• This analysis includes gaining insights by drilling down into historical employee data,
surveys and feedback records and assessing KPIs such as the return per employee and
human capital value-added.

c. Classification Analysis to Determine the Success Rate of Teams

• Classification analysis is the process of analyzing historical data to identify patterns
that help us predict which category a particular observation or data entity belongs to.
In HR, this analytical method can be used to study the composition of a team, and other
context variables in order to determine how successful the team will be.
• Instead of forming teams merely on the experience, availability of resources,
organizations can use insights from classification analytics to understand what other
factors such as leadership style, team dynamics and size, the duration of a project, etc,
impact the success rate of a team. Being able to determine the success rate of a team
beforehand, enables organizations to form the right teams for a project.
d. Attrition Analysis
• High attrition is a huge challenge for HR teams and cost intensive for companies.
Job postings, recruiting, onboarding and training are some significant expenses of

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losing employees and replacing them. This is a bigger problem if you’re in a

customer-facing business as customers prefer to work with a particular set of people
they’re habituated with. One way to reduce attrition is by using advanced analytics
and NLP to harness the employee reviews data from employment websites like
Glassdoor, Indeed, Comparably etc. This analysis helps you measurethe employee
satisfaction towards the brand and understand the common factors that lead to
attrition.
e. Personalizing Training Programmes
• Instead of applying run-of-the-mill training methods and general programs for all
employees, the HR team can instead personalize courses to suit the learner’s
preference.
• In order to do so, ‘adaptive’ learning technology must be used in which data analytics
determines the learning pace of the employee, the mode of training, as well as what
questions are best suited for them, in order to personalize the course to suit the learner.
f. Capacity Analytics and Utilization
• One of the major business benefits of advanced analytics in HR is in cutting down
costs. HR teams can use Capacity Analytics to determine:
• What the team capacity is and how much of it is actually being utilized.
• What activities the team is engaged in when they are working.
• What processes, tools, and applications are being used to complete the work and
how much they cost the company.
• How operationally efficient the team is – helps determine if the team is either
overworked or underutilized.
• The capacity for growth.

g. Improving Employee Performance

• Although traditional methods of determining and managing employee performance
such as peer and manager review, monitoring KPIs, etc, are globally used, they have
not been very impactful in improving employee performance.
• But with Employee performance analytics, individual employee performance can
be measured much more efficiently with the help of both historical and real-time
data. Employee performance analytics provides both a retrospective as well as a
forward-looking analysis of what employee performance was and how we can
improve it. With the resulting insights, we can identify the employees that are
performing well and which employees need additional training and motivation in
order to perform better.
h. Anomaly Detection Analysis
• Anomaly detection analysis is used to recognize unexpected or deviant patterns.
• In HR management, anomaly detection analysis can help identify relationships between
accidents at work and employees who are working longer working hours andpossibly
fatigued. By identifying resources that work longer than a specified threshold, HR
teams could prevent accidents and injuries in the workplace.

4.10. Advanced Supply Chain Analytics

a. Capacity Planning:

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• Capacity planning allows you to match procurement and manufacturing capacity to

sales demand. It includes various strategies such as:
• A lead strategy that refers to installing capacity or producing goods in anticipation of
demand
• A lag strategy where capacity is added once the current plant can’t meet demand
• The match strategy that involves incrementally adjusting capacity adjustments to match
demand
• Each approach has its merits, but the dilemma is knowing which is best for any
particular situation. The answer lies in you developing a thorough understanding of
your market, your competitors and those factors that affect demand.

b. Advanced S&OP
• Advanced sales and operation planning, sometimes called integrated business
planning (IBP) is a next-generation S&OP that includes finance. Instead of the
conventional S&OP focus on how to maximize widget production, advanced S&OP
looks at the financial bottom line to determine the most profitable production and sales
scenarios
c. Simulation and Scenario Analysis
• One of the crucial features of strategic planning is determining potential business
scenarios and devising appropriate strategies. Royal Dutch Shell was one of the first
major corporations to practice full-scale simulation and scenario planning. This work
has helped shape the company’s future and guide it through numerous crises.
d. Optimization
• Optimization refers to the use of prescriptive analytics to determine the optimalsolution
to a business problem. For example, it’s extremely difficult and complex to determine
the optimal inventory strategy for a company involved in omnichannel retailing. On the
one hand, there’s the need to ensure brick-and-mortar stores have adequate bulk stocks,
while on the other, the need to fulfill multiple single orders to customers all over the
country
e. Demand Shaping
• Demand shaping is what retailers apply to change demand for their products, rather
than seeking to fulfill existing demand. A sales promotion is a typical example of
demand shaping. The problem that often occurs is that sales promotions initiated by
marketing don’t always correlate with procurement and manufacturing capabilities, the
result being that a spike in demand causes stockouts and lost sales
f. Digital Planning Twin
• A digital planning twin takes this concept a step further in that the model is
continuously updated with data from the real world. In this way, the model becomes
dynamic, and it’s possible to use the model’s behavior to track what’s happening in
the real world. The advantage is that it’s possible to react in real-time to unexpected
developments and determine dynamic solutions as the need arises. River Logic’s
SmartSolve™ is an example of an always available, scalable solution in the cloud that
offers the prospect of real-time optimization
4.11. Top Five Applications of Big Data Analytics In Supply Chain Management
• Supplier Relationship Management
• Product Design & Development
• Demand Planning

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• Logistics Management
• Machine Maintenance

4.12. How Does Predictive Analytics Work In Supply Chain

a. Demand Forecasting: Historical data is a key component when it comes to
forecasting demand.
Example: Supermarket Chain
• It can leverage predictive models to predict the demand for particular products by
utilizing past sales data and trends in the market.
• For instance, if the data shows that customers usually buy more cereal during winter,
the store can order more stock of the new cereal in the fall to prepare for the increase
in demand during winter.
• In doing so, its supply chain can optimize inventory and reduce the risk of overstocking
or understocking. Hence, satisfying customer demand without incurring losses.

b. Logistics/Transportation Optimization: Logistics is crucial as it manages the

goods of a company from origin to consumption

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Example: Food Industry

Food companies need to ensure that their products are transported quickly and
efficiently to maintain freshness and quality. Predictive analytics models can help
supply chain managers optimize fleet performance by analyzing data on shipping
routes, weather patterns, and traffic patterns.
Moreover, predictive analytics tools can help determine the most efficient
transportation routes and modes of transportation to reduce costs and improve delivery
times. The use of predictive data can also accurately predict the transportation needs
of perishable goods. Hence, ensuring that the goods are delivered on time and remain
fresh
c. Supply Chain Risk Management
• Predictive analytics models can identify patterns and trends that can help
you anticipate and mitigate risks before they occur. The analysis of current
and historical data can help you better understand your supply chain, identify
potential risks, and take proactive steps to reduce exposure to those risks.
Example: Manufacturing Industry
To keep production plans on track and meet consumer demand, manufacturing
companies ensure a steady stock of raw materials and supplies. Fortunately, you
can adopt predictive insights to reduce supply chain risks with the aid of predictive
analytics.

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Collecting data from suppliers, transportation routes, and logistics providers, and
utilizing machine learning algorithms and statistical methods help you to identify
potential disruptions and take proactive measures to minimize the impact.

For example, a manufacturing company may use predictive models to analyze big data
on supplier performance, including lead times, quality metrics, and delivery schedules.
Another example is to analyze data on machine performance, production rates, and
maintenance schedules to optimize production output and reduce downtime.downtime.
d. Biotechnology Company
The client was an American biotechnology company. Lack of access to supply chain
planning data meant that the company didn’t have visibility into the latestinformation.
As a result, their planners had to invest significant manual effort toobtain up-to-
date data to create reports.

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4.12.1 Container Leasing Company

A top container leasing company initiated a Business Intelligence Program to fulfill its
analytical reporting requirements while reducing its reliance on IT. Its need isn’t exactly to
implement predictive analytics, but the integration of the custom solution does affect the supply
chain

IBM
IBM, the owner of The Weather Company, uses Watson to make accurate weather predictions,
which impacts consumer behavior. By analyzing data from multiple real-time sources, such as
social media and news stories, IBM can identify how customers react to weather conditions
and make informed decisions on the supply chain.

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Part-A
1. What is HR analytics?
HR analytics is a data-driven approach to managing people at work. HR analytics, also known
as people analytics, workforce analytics, or talent analytics, revolves around analyzingpeople
problems using data to answer critical questions about your organization. This enablesbetter
and data-driven decision-making.
2. What are common data sources for HR analytics?
Common data sources include internal data like demographic employee data, payroll data,
social network data, performance data, and engagement data. External data sources can include
labor market data, population data, LinkedIn data, and much more. Any data that’s relevant for
the specific project can be used.
3. What skills are required to do people analytics?
Relevant skills for people analytics include business consulting to identify critical issues,
analytical skills to run the analysis, stakeholder management to bring everyone together and

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enable the people analytics project, and storytelling and visualization in order tocommunicate
effectively with the business and share results.
4. Who Is Responsible for Logistics Management?
This differs from company to company and role to role but a specialist in logistics is called a
logistician. They are responsible for analyzing and coordinating an organization’s supply chain
and oversee the entire life cycle of a product from acquisition through to delivery.
5. How Does HR Analytics Drive Business Value?
Or
HR has access to valuable employee data. How can this data be used to enable change in
the organization?
• There is a great deal of discussion on replicating the consumer experience in the
employee experience. Essentially, the data on consumer behavior and mindset can
help develop strategies to maximize sales by capitalizing on those factors.
• Similarly, the data useful for the HR function can be used to improve employee
performance, the employee experience, and in turn, maximize business outcomes.
• Collins offers an example of how HR analytics can be used to enhance business value.
“HR analytics could be used to measure investments in reskilling, which will deliver
the right competencies to support a new revenue model, using data-driven insights to
modify the training offering as sales results emerge.”
• This is definitive granular data that can not only impact the bottom line, it can also
transform employee engagement in an organization.
• “As such,” Collins continues, “you might think about the ‘ROI’ of HR analytics being
that of increasing the business value derived from using data for talent decisions.”
6. What Metrics Does HR Analytics Measure?

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7. What is Human Resource Planning?

• Human Resource Planning (HRP) is the process of forecasting the future human resource
requirements of the organization and determining as to how the existing human resource
capacity of the organization can be utilized to fulfill these requirements. It, thus, focuses on the
basic economic concept of demand and supply in context to the human resource capacity of
the organization.
8. Why Are Supply Chain Networks So Important?
Supply chain networks mostly manage the flow of consumer goods in our everyday life. The
professionals of the supply chain are skilled and experienced to face any sort of unexpected
situation. They can work out the best feasible approach to deliver the necessary products to the
consumers. And, to do so they analyze the situation and accordingly take productivesteps.
The supply chain network is very important for the majority of businesses which is a great
boost for the success of a business.
9. List Categories of Supply Chain
• There are two types of the supply chain: -
• The Push Model- is the marketing-oriented approach. The inventory is generated as per the
authentic demands.
• The Pull Model- which is the customer oriented approach. According to this approach, the
consumer placed the first order. After that only the ordered product production start.
10. What Is a Supply Chain Network?
A supply chain network describes the movement of both materials & information, assessing
the programs and policies that impact the supply chain. Most business units in an organization
have an interest in efficient supply chain operations. A supply chain network design documents
these interactions, tracks improvements and sets long-term goals.
11. What is Demand Planning?
Demand planning is a supply chain management process of forecasting, or predicting, the
demand for products to ensure they can be delivered and satisfy customers. The goal is to strike
a balance between having sufficient inventory levels to meet customer needs without having a
surplus. A wide variety of factors can influence demand, including labor force changes,
economic shifts, severe weather, natural disasters or global crisis events.
12. Definition of Logistics Management
The management process which integrates the movement of goods, services, information, and
capital, right from the sourcing of raw material, till it reaches its end consumer is known as
Logistics Management. The objective behind this process is to provide the right product with
the right quality at the right time in the right place at the right price to the ultimate customer.
13. Define Inbound logistics and Outbound logistics
• Inbound Logistics: The activities which are concerned with procurement of material,
handling, storage and transportation

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• Outbound Logistics: The activities which are concerned with the collection,
maintenance, and distribution or delivery to the final consumer.
14.Why is HR analytics important?
HR analytics is a data-driven way to controlling people in practice. HR analytics, which is also
called workforce analytics, talent analytics, or people analytics, spins around analyzing
people’s queries using data to solve critical questions about the organization. This facilitates
more dependable and data-driven decision-making
15.What are the roles and responsibilities of an HR analyst?
As an HR analyst is required to perform organizational development activities using primarily
data. Some of the roles and responsibilities are –
1. As an analyst you are required to talk to the business to find out what the real problems in
the company are. This requires a consulting skill set.
2. As an HR analyst you are required to talk to the employees to really define the issue.
3. As an analyst you are required to look at the available data. As an analysts need to generate
data themselves by creating questionnaires or establishing other measurement methods.
16. Which abilities do you feel an employee needs to achieve success within SCM?
Hiring managers frequently use this to figure out whether the abilities you mention align with
whatever they think a candidate has to achieve success in the job. Consider the abilities you
keep that make you a good prospect and exactly how they will benefit the business
17. What are the Logistics Components
Ans: The management of logistics can involve some or all of the following business functions,
including:
• Inbound transportation
• Outbound transportation
• Fleet management
• Warehousing
• Materials handling
• Order fulfillment
• Inventory management
• Demand planning
18. Define LSCM
Logistics management is that part of the supply chain that plans, implements, and controls the
efficient, effective forward and reverses flow and storage of goods, services, and related
information between the point of origin and the point of consumption in order to meet customer
requirements
19. What is the Ultimate Objective of Supply Chain Management?

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• Supply chain management is driven towards achieving efficiency in its operations and
maximizing productivity in an organization. Companies hope to satisfy the demands
of people by delivering the right goods to them on time while profiting from doing so.
• While streamlining the whole process, supply chain managers ensure that waste is
minimized, and there is productive utilization of everyone’s time, allowing the
organization to cut costs. All of these smaller goals lead to one ultimate goal, which is
to achieve efficiency.
20. What Comprises Supply Chain Management?
• Supply chain management is incomplete without including collaborative and
integrative practices with its channel partners. Suppliers, retailers, wholesalers,
distributors, and customers are involved in the success of a supply chain operation.
• Supply chain managers must collaborate with suppliers, keep track of demand,
integrate the services of wholesalers and distributors, and effectively communicate with
everyone involved, including customers, in the process.
21. What Is the Role of Big Data In Supply Chain Management?
Data is crucial in the development of today’s operating systems. In supply chain management,
leveraging big data helps to control the movement of cash, information, and goods in a supply
chain. This is mainly done to assure high levels of product availability and service to customers
at the lowest feasible cost. Supply chain managers can also use data analysis to monitor these
flows and use the results to improve their job performance.
22.What Kind of Big Data Analytics Can Be Used In Supply Chain Management?
Descriptive, predictive, and prescriptive supply chain analytics are the three categories of big
data analytics in supply chain management. Each one helps you manage your inventories
differently. Dashboards are made up of descriptive analytics. Predictive analytics, on theother
hand, is most generally characterized as demand forecasting. And Prescriptive Analyticsis all
about making recommendations for actions that will improve the performance of your
inventory system.
23. How Is Big Data Analytics Applied In Supply Chain Management?
Big data analytics helps businesses acquire insights from vast amounts of data. The same is the
case with supply chain management. There are many ways through which big data analytics in
supply chain management works wonders. The top four applications of this remarkable
analytics are supplier relationship management, product design and development, demand
planning, and logistics management.
24.What Impact Does Big Data Analytics Have On Supply Chain Value Creation?
In addition to profit maximization and revenue growth, value creation is a critical aspect of
ensuring a company’s long-term viability. This could range from improving communication
between manufacturers and suppliers to shortening delivery times. Big data analytics in supply
chain management improve operational efficiency and performance monitoring, resulting in
increased production.
25.How BA can influence Supply Chain Management

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Business Analytics can bring about a huge change and redefine the way you look at Supply
Chain Management. Probably, you can predict future happenings on the basis of various
sources of information, for e.g., social media, news outlets and other platforms, which can give
a cue about the recent happenings. This will allow you to be better prepared in case of any
disaster eventually happening
Part-B
1. Explain human resources analytics working methodology
2. Explain HR analytics training and development process
3. Discuss supply chain network management steps
4. Explain logistics process in supply chain analytics
5. Explain supply chain analytics applications
6. Discuss about the activities involved in human resources management with
few samples’ scenario
7. Discuss in detail the relationship between logistics and supply chain with a
scenario

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