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“PLANNING HUMAN RESOURCE AT URBAN INFRASTRUCTURE DEVELOPMENT INVESTMENT CORPORATION – ONE MEMBER LIMITED LIABILITY COMPANY - 2015” CONTENTS ISSUES TO STUDY Theory basic human resource planning 1.1 Concept of planning human resourcec Planning human resource is a process of research, determination of human resouce demand and implementation of programs, activities to ensure company having sufficient human with suitable qualification, skill to carry out the work prodcutivitly and efficiently Planning human resource is often specified by short-term and long-term plan for human resource This plan can be flexibly adjusted in accordance with business’s change The effectiveness of the human resource planning strategy depends on the compliance of human resource strategy with the overall business’s strategy such as marketing strategy, new product strategy 1.2 Major reasons for development of human resource in company 1.2.1 Ensuring human resource to meet requirement of number and structure: In terms of human resource number, the first question to be named is how many people will leave and come to company in the future and this question is used for determination of human resource number For ensuring structure and number of human resource, company should conduct well human resouce planning and and labor recruitment a Human Resource Planning Human resource planning is a process of deployment and implementation of planning for human resources to ensure that there are sufficient labor, good quality to be arranged for the work once required on time and on place That is an assessment process, identification of human resource demands to meet the company business goals and also a make of human resource plan to meet such demands b Labor recruitment Labor recruitment is an important issue among human resource management that includes following activities: job analysis, recruitment and selection of employees to ensure the quantity and quality of labors in accordance with company business development 1.2.2 Improving quality of human resource On the basis of current human resources, company business shall maintain its good human resources and also find ways to improve quality of current human resources including: a Review work performed by employees The review methods are often used as: scoring method alternated ranking method, pair comparision method, behavioral observation methods, Objective management method b Training and development of human resources 1.2.3 Efficient use of human resource Development of human resources has close relation to efficient use of company human resource The efficient use of human resources is based on good allocation and cooperation of labors a Allocation of labor Currently, there are three common types of labor allocation in company as follows: + Functional allocation of labor + Profesional allocation of labor + Allocation of labor following the complexity level of job b Cooperation of labor: Nowaday, there are two types of labor cooperation in company such as: + Cooperation in space aspect; + Cooperation in timme aspect; 1.2.4 Due care of settling social regimes for employees in order to create motivation and encouragement of work a The material wage: basic salary, allowance, bonus, welfare b The un-material wage: promotion, good condition and environment for working 1.3 Factors impacting to company developement of human resource 1.3.1 Outside factors a Diversification of labor Current workforce includes many elements coming from different locals, regions They differ in religion, educational level, ability, age Therefore, when the labor workforce is an increasing diversification, the management of human resource in general, the development of human resource in particular become more complexity b Education - Training quality of labors before being recruited into the company will decide the development policy of human resource in the future c The development and change in science, engineering, technology dramatically affect the human resource of an enterprise From that it also affects the company’s development policy of human resource because the workers themselves, rather than the other ones will have to acknowledge, master the advances of such science and technology in order to apply them into the works and then serve for the development of company’s business d Economic chanlenges The economy has experienced profound changes in addition to the spread of globalization trend has forced companies to change to adapt to these changes, to make business decisions more productively and effectively It could restructure departments’s personnel to reduce costs Besides, they also attract qualified managers having higher professional with higher wages e Goverment’s training policy and development of human resource: whe the later issued policies have changes; the company must change its policy of human resource development appropriately f Labor market signal Labor market signals are information flow obtained from the labor market, including messages, news, or indicators such as wages, employment, unemployment displaying the status and trends of the labor market When these signals are collected periodically, analyzed systematically, they will form a labor market information system and impact to company’s policy of human resource development 1.3.2 Inside factors a Company’s demand b Organization structure, company’s business scale c Factors that belong to employee and managers 1.4 Forecast company’s human resource Company’s demand of human resource is the need of entire workforce required for implementation, completion of business tasks (production-business plan) and further tasks (business strategy) - The identification of company’s human resource demand starts from business strategy Company shall make a specific production – business plan basing on the required labor (determined by machine and technology and labor’s qualification), the retiring replacement to calculate manpower needs From that manpower needs and human structure, company will determine the need to recruit and training needs for themselves - Human resource demand must represent in the number and proportion of labor workforce (human structure) The level of current labor structure meeting requirement comparing labor structure must be required for implemention and completion of shor-term and long-term company’s tasks shall be determined as human quality Map for determination of company’s human resource demand Company’s business Strategy Detailed business plan Equipment / Machine available for production Production norm Labor requirement Demand for recruitment Labor capacity Demand of labor for replacement of retired people, leaving labors and on-training staff Current labors who meet requirement including leaving and on-training labors 1.5 Basic for planning human resource 1.5.1 Job analysis Job analysis is understood as a process of defining a system of tasks and skills needed to perform the job in an organization Job analysis is considered a basic and most important tool for human resources management It is a base for implementing all human resource function within company Since, the first basic e of human resource planning is the job analysis When conducting job analysis, management administers must answer the following questions: − − − − − − 1.6 1.6.1 What kind of job the employees do? When is job completed? Where is job implemented? How did the employee implement the work? Why they need to that job? What are requirements for doing that job? Some criteria to review the efficiency of human resource use Average working productivity criterion Average working productivity is a specific production capacity of individual labor It reflects the result of individual labor’s production activity in a certain time unit This indicator is defined by the formula: W = Q/T In which: W – Average working productivity of a labor Q – Total output in production T – Total labors Average labor productivity criterion is a basic important quality indicator in basic company’s business processes This criterion also assesses the level of labor during operation 1.6.2 Efficient use of wage expenses criterion This indicator is defined by the formula: HQtl = M/QL In which: HQtl – Efficient use of wage expenses M – Turnover QL – Wage fund This indicator reflects that in order to earn a unit of sale, how much money company pay for wage The greater index is the the higher efficiency 1.6.3 Wage productivity criterion This indicator is defined by the formula: H = LN/QL In which: H – Wage productivity LN – Profit QL – Wage Fund This indicator states that a unit of money paid for wage created how much profit Efficiency wage shall increase when labor productivity increased at a higher rate of wage growth rate 1.6.4 Staff’s profitable capability criterion The average profit of an employee in company is one of the important indicators to evaluate the company’s effective use of labor A company makes an effective business when it creates more sales, more profits This indicator is defined by the formula: H = LN/NV In which: H – Staff’s profitable capability LN – Company’s profit NV – Average number of labor The higher indicator is the higher labor efficiency and vice versa The formation and development of Urban Development Infrastructure Corporation (UDIC) • Corporation Name: Urban Development Infrastructure Corporation (UDIC) • Address: 27 Huynh Thuc Khang – Dong Da District- Hanoi • Tel: (84-4) 3773 3625 - Fax: (84-4) 3773 1544 • e-Mail: udic@udic.com.vn • Website: udic.com.vn 2.1 Formation History Urban Development Infrastructure Corporation – One member limited liability formerly known as Foundation Backfilling Company under Hanoi Construction Department was established under Decision no 2639 / QD-UB dated 06/10/1971 of Hanoi People's Committee On 13/04/1990 Hanoi People's Committee issued Decision No 1740 / QD-TC, changed Company’s name from foundation backfilling to Construction Engineering Infrastructure Company After six years of operation, the company continues to be renamed as the Urban Development Infrastructure Corporation According to Decision No 111/2004 / QD-UB dated 20/7/2004 of the Hanoi People's Committee, the Urban Development Infrastructure Corporation was established in form parent company – subsidiaries which based on reorganization of the Company with the inclusive of members (subsidiaries) from State-owned enterprises, joint stock company, the joint venture company under Hanoi Departments of Civil Engineering, Transportation, Industry and Union of Import-Export Company (Unimex) In Decision No 3462 / QD-UBND dated 13/07/2010 of Hanoi People's Committee and the Business Registration Certificat no 0100106232 issued by the Department of Planning and Investment in Hanoi on 04/7/2011, Urban Development Infrastrucutre Corporation was renamed as Urban Development Infrastructure Corporation – One member Limited Liability Company 2.2 Organization chart Assessment of current human resources in UDIC 3.1 Assessment of Corporation’s human resource on number and structure a Assessment of Corporation’s human resources on number showed that employee numbers had gradually increased over the years, from 1,400 in 2012 to 1,650 in 2013 and 1,855 people in 2014 The average growth speed is 15.10% / year in period 2012-2014 b Assessment of Corporation’s human resource on structure * Structure of labor following nature of work Company’s labors mainly include direct labor working on project sites, there are 1,320 people in year 2012, accounting for 94.29% of total; 1,550 people in year 2013, accounting for 93.94% of total and 1,728 people in year 2014 accounting for 93.15% of total * Structure of labor following age Company’s labors have wide age range, varying from 18 to over 55, young workers from 24 to 35 years old accounting for largest proportion has increased from 2012 to 2014 In year 2012, employees from 24 to 35 have 882 people, accounting for 63.00% of total, in year 2013, there were 1,132 people accounting for 68.61% of total and in year 2014, there were 1,337 people accounting for 72.08% of total * Structure of labor following working seniority According to working seniority, there is a division of labor having seniority over 20 years, focusing on the number of managers and professional technicals existed since establisment of company to date * Structure of labor following type of labor Company’s labors could be classified following three main categories which are management labor, professional- technical labor and unskilled workers The number of labor types has gradually increased over the years, in which un-skilled works was largest proportion, with 1,320 people in year 2012, accounting for 94.29%, with 1,550 people in 2013, accounting for 93.93% and 1,728 people in year 2014, accounting for 93.15% 3.2 Table: List of UDIC’s workforce level No Content Unit 2012 2013 2014 Total of Labor People 1400 1650 1855 I Managers People 95 98 108 Post Graduated Graduated Other People People People 35 55 40 55 48 58 II III Professional Engineers Post Graduated Graduated Other Technical Labors People People People People People 315 86 186 43 657 412 102 212 98 797 553 122 399 92 843 Grade 3/7 People 269 337 353 Grade 4/7 People 214 254 262 Grade 5/7 People 98 119 125 Over grade 5/7 People 76 96 103 IV Outsource labors People 333 343 351 Source: Administration Department 10 Making human resource plan for UDIC in year 2015 4.1 Steps for human planning schedule: 4.1.1 Demand determination Based on Corporation’s production and business strategy in 2015 as well as actual situation in the factories, project sites, Management Board shall set up plan for human resource demang for every year 4.1.2 Demand Forecast Corporation divide the forecast process into three periods  First stage of short –term labor forecast: Step 1: Determine the workload required for implementation during planned period: this could be done through the amount of product, sales Step 2: Determine the required labor for each type of work based on the use of the conversion rate From the volume of work and basing on labor norms, they calculate the total time required to complete the work Thus, they could determine the number of workers needed for each job Company could use the reulation to identify labor norm or they could calculate by themselves to identify more correctly Specifically as follows: - For the production: they can calculate required time, the output so that it could be converted into the labor consumption per unit of product Formula: T=∑ ni=1Qi*ti In which: T is total of hours (days) required for person to carry out the work Ti: neccesary time for production of unit numbered i Q: work volume numbered i N: types of produced production Then, number of labor required shall be: In which: D=T/Tn*Km Km: factor to increase work productivity T : average working time of person in planned year 11 Tn: calculated by making table for recording working time of each worker during working hours If basing on average working productivity: D = Q/W In which: W: average working productivity of labor Q: is volume of works or sales - For servicing work: T=∑Mi*Ki*ti In which: T: total required time Mi : number of equipment ordered i Ki: number of working shift of equipment ordered i Ti : required time for servicing equipment ordered i - Servicing level of workers The number of workers serving one machine: D=M/Mpv*k - For other works: For those workers, it will use the little conversion rate no change + Using boundary standard methods: Step 3: Calculate the number of managers in varied types To calculate the management persons, it is to use boundary standard method to determine directly for each department, unit The more complex function, the more people required for department However, if the company’s organization structure is not good, it will make the unreasably increased forecast results, therefore, it is necessary to improve organization structure prior to determining the amount of managers To calculate the management labors, company need to calculate boundary standard management labors following formula: In which: Lqli =∑Ty/c/(365-60)*8 Lqi: number of management labor type i Ty: working hours required work contents Step 4: Determine human resource demand in planned period 12 Total of demand = demand of direct labors + Management labors To simplify the forecast work of human resource demand, in the condition that company have stable production system and business, they could calculate the increasing labors, since that it could calculate company’s total demand of human resource The advantage of this measure is simple, less expensive however its accuracy is not high  First stage of medium – term labor forecast: Medium-term planning of human resources from to years: during this period, UDIC’s production and business plan was very clear through the certain project, the specific work under construction, then medium-term planning of human resource shall mainly focus on personel arrangement for projects, interal work within company Therefore, Personnel department shall be responsible before general director of the Corporation UDIC to make this medium-term plan The person directly responsible before general director is Chief of personnel department Regulation for making such pan shall be as same as making longterm plan, i.e the related professional departments have to provide information to personnel department for making plan The diferent features between making such plans are mechanism relating loosening, therefore the coordination between other departments with personnel department is not tight After receiving the relevant information, personnel department review actual projects, consult with project managers about the specific labor variations, therefore, medium-term plan is more accurate Methods of this personnel planning is still based on qualitative methods, although the work task could be analyzed because they are quiet clear about number of project, production plan Features of this medium term plan is to make plan of personnel following projects which have construction period from to years Based on business and production plan, total value of production and cost estimate, they forecast human resources demand, make planning for this period Based on long-term plan for human resource and mainly from short-term personnel plan submitted by departments, Company review and make this medium-term plan This plan requires a relatively accuracy so that personnel department should pay attention on developing this plan 13 The forecast figures for this medium term is the sum of the experience of personel department’s staff and information collected from team leaders After completion of medium-term plan for human resource, personnel department send this plan officially in writing to other departments for consultation and finally adjusted to submit to General director for approval After that, this plan is sent to departments for implementation  First stage of long-term labor demand forecast: Every beginning January of year, starting new business plan or personnel plan of Corporation, Directors have to send new human resource plan together with business plan to Corporation UDIC assigns personnel department to be mainly and directly responsible before General Director for making plan of long term key personnel plan The individual to be mainly and directly reponsible before general directo is chief of personnel department At the same time, general director directly supervise the process of making plan for long-term human resource, chasing personnel department for on time completion Directors also have the mandatory rules for related departments to be responsible for providing the necessary information necessary for making plan of long-term human resources, for example, departments have to send to personnel department reports about current employees, estimated personnel require, number of labor to reduce, forecast future works, plan for business expansion These are madatory provisions which main responsible persons are cheifs of departments At the same time, director is also responsible for providing plan of long-term production, plan of business expansion so that personnel department could complete the task With the assigned functions, certain rights, personnel department can mobilize staff from department to participate in the development of plan for long-term human resources Personnel department shall review figures and make plan for personnel in future They will not make plan for long-term human resource theorically following job analysis or job performance review but mainly based on plan for production and business and based on their experience to give the figures to be appropriate with the strategy of the business After completion of planning for long-term human resources, personnel department send this in writing to director for approva and director send it to Board of management as well as company’s departments This plan will be review and adjusted following company’s 14 departments’ comments After that, Corporation shall approve and accordingly the plan is a base for UDIC Corporation to follow 4.1.3 Forecast of human resource supply - Internal human resource supply: Build the capability to meet company’s human needs Under this step, they can use the information system of human resources to determine the number of employees can meet the requirements Information system of human resource is a comprehensive list of information about all labors working in the organization, including: + Personal Profile + Education level + The assessment of strengths and weaknesses + The skills and knowledges + Location and type of work being done + Seniority at the current position + Seniority in the organization + Expectation of work and location + Intended retirement date + Potential development and promotion possibilities + History of wages and salaries The research on information system of human resource is essential for prediction of internal labor supply However, the management in big companies is very difficult, therefore, company could divide information into two categories including skill and management list in order to simplify administration - Outside human resource supply: Company simply determined that outside labor supply is mainly based on public information such as the labor newspaper, employment consulting services, professional training centers and recruitment centers for recruiting required technical labors 4.1.4 Method to balance Corporation’s human resource 15 a In case of personnel redundance + + + + + Stop recruitment; Internal job arrangement; Stop outsourcing; Job sharing; Retrenchment; b In case of lack of personnel Company will base on the recruitment requirement for recruting the neccessary labos compliance with job requirement and working conditions c In case no excess, no shortage There is a method to arrangement of internal labors to be compliance with their capability 4.1.5 Assessent method for improving quality of Corporation’s human resource a Job performance review The company paid attentions on the review of job performance of each labor However, this evaluation has not been regularly carried out as it has mainly focused on direct working labor The evaluation was conducted quarterly and year-end for purpose of considering rewards Through the survey of completion level, most of labors have self evaluated that themselve had completed work in range of good level (accounting up to 85,2%) b Training and development Company’s leaders paid much attention on training and development task but its planning had not been carried out properly and regularly The training focused for some highest managers Technical experts, unskilled workers are mainly trained in professional improvement No position planning is made Results of surveying the instruction for new coming labors or starting labors showed that among 230 surveyed people, 203 answered that they were instructed (accounting for 88.3%) and the remaining 27 (11.7%) responded that they were not instructed specifically In regard to training, through survey results, there were 17 responding that they had not participated in any training, accounting for 75.7% of the respondents, 54 who have participated un-reglularly and only persons were regularly trained 16 4.1.6 Implementation of social policies * Wages, salary allowances, bonuses In regard to wages, salary allowances, bonuses regimes , companies applied the distribution method in paying salaries and wages to employees that followed job types, positions Survey results showed that ony 2.2% of surveyed staff feels satisfactory with company’s current salary, wages and other benefits, 53.9% of that considered unsatisfactory and other 43.9% said that it is not appropriate 4.1.7 Factors impacting to Corporation’s development of human resource a Changes in science and technology: In the today trend of integration and globalization today, along with the strong development of information technology and the important achievements of some technology industry, the process of globalization and internationalization has made its advantage over the management transfer of management skills that corporations in the construction field, including UDIC are requiring b Laws environment Government Policy Law system Law, complicated international regulations c Economic Environment Expanding and developing international markets Expanding and developing domestic market Expanding business d The increase of competition level: In the general dificult situation, cost of electricity, water, transportation continuously change, high interest rate of bank loan, not easily approaching to bank loan, construction companies need to have appropriate policies, solutions for production-business management in order to enhance their business competitiveness wtih other competitors 4.1.8 Assessment of plan for human resource in UDIC General assessment of the development of UDIC’s human resources a Strengthen 17 - Corporation’s human resources have a growth in both quantity and quality Number of employees has increased over the years from 2012 to 2014 Thus, development of human resources in terms of the amount was initially to ensure the increase in the scale of Corporation’s operations In terms of quality, it also has increased, the direct employees with educational level are relatively high - In recent years, awareness of the importance of human resources to the efficient production and business operations has significantly changed Corporation was interested in and implemented recruitment more public and clearer than previous years The recruitment has focused on guiding the work, labor arrangements with professional excellence b Weakness - The quality of labors is generally not high, mainly unskilled labor It can meet the requirements for production, but in terms of development it has certain limitations, especially in training, career development planning - No methodical recruitment process No direction for planning staff at the Corporation - Salaries and bonuses system have not really impacted to encourage workers for better work and feel secured in work There are some labors assigned not compliance with their professional and capability There is no frequent training and no suitable forms of training c Reason - Personnel department under administration unit does not have enough people to carry out and advice sufficiently about issues for human resource development - No plan for development of human resources is made scientifically - No approriate investment policy for employees Wage policy was not fairly established - Not yet build of Key performance indicators to assess each labor’s work carried out and capability - There is no policy to support training for managers 4.2 Solution for making plan for human resource in UDIC 18 4.2.1 Group of solutions for ensuring the number of human resource in Corporation a Perform well the planning of human resources Based on historical data to forecast manpower needs for the next year Company’s manpower needs in year 2012 was 1400 people, 1650 people in year 2013, 1855 people in year 2014 and 2000 people in year 2015 b Set up new processes of recruitment and planning appropriate recruitment Based on careful analysis of human structure required to meet each unit, department, process of recruitement is made accordingly 4.2.2 Solution for professional development (staff planning) in Corporation a Set up model of professional development Principles of career planning by the Corporation is to combine the personal career aspirations with opportunities available within the company In particular, both individual workers and supervisors share the work Model of professional development for staff and employees in the company may follow two directions as below: • Vertical development • Horizaontal development b Set up model of professional development 4.2.3 Group of supporting solutions for aiming to improve quality of human resource in Corporation a Solutions for training human resources in the company are to meet the needs of professional development (planning staff) and improve existing skills in the company • Identify training needs To identify training needs, HR Administrative Organization need to carry out surveys, comparison between tbale for sandard skills of job positions and assessment of performing the actual work of each employee It is used to prepare human resources in the future • Conduct training b Improving the quality of job performance reivew of workers 19 In order to implement good assessment, it is firstly to complete data about employees in the Corporation; reinforce the evaluation board; build of assessment standard based on job analysis table; combining many different forms when evaluating c Build of specific training plan for each employee to perform good assignment Through survey, most of workers advised that corporations should have specific training programs The issued plans should be accordingly implemented d Innovating training program, extensive, appropriate and effective training types for improving professional skill and arrangement of working as team for unskilled workers e Improving awareness of management skills f There should be a policy to retain and attract employees having good professional and technical skills inside and outside Corporations 4.2.4 Group of solutions for efficient use of human resource in Corporation a To complete the organization, arrangement of labors following sectors, occupations, production teams b To review indirect labor force in the company and appropriately arranged 4.2.5 Group of solutions for enhancing motivation of employees a To complete the policies of material incentive for employees such as salary, bonus and other welfare regimes b To complete the policies of spiritual incentive for employees Conclusion More than any other resource, people always take place as important position in the social - economic development strategy of a country People are both subject for service by all social and economic activities and factor having a decisive role for the development of society Nowadays, the trend of globalization and the increasing competition, people are considered as invaluable assets and the most basic elements affecting to the survival and development of the organization Though an organization has a rich financial resources, abundant material resources, modern machinery system and high technical and scientific formulas but without the efficient management of human resources, the organization will 20 find difficulty to develop Therefore, the competitiveness of enterprises and organizations to obtain high-quality human resources becomes ever more intense The organation management of human resources created culture, cheerful or stressful atmosphere, gloom of that organization Such operation environment is decesive factor of the organization’s sucess Therefore, human resource management plays an important role in the operation’s management None activity of the organization is effective without management of human resources The basic objective of human resources management in any organization will be how to use human resources effectively to achieve organization’s targets Well recognizing this issue, the Urban Development Infrastructure Corporation paid much attention on the management of human resources, especially to attract and maintain strategic human resources, high-quality human resources References 1) Lecture of Human Resource Management, 2) Human resource management,2011, Associat Professor – Dr Tran Kim Dung, Ho Chi Minh City General Publisher 3) Company’s human management Textbook – Dr Do Van Phuc, Hanoi University of Science and Technology 4) Human Management Textbook – Department of economic and Human resource management of National Economics University 5) Website: udic.com.vn 21 ... to personnel department for making plan The diferent features between making such plans are mechanism relating loosening, therefore the coordination between other departments with personnel department... difficulty to develop Therefore, the competitiveness of enterprises and organizations to obtain high-quality human resources becomes ever more intense The organation management of human resources created... long-term human resources, for example, departments have to send to personnel department reports about current employees, estimated personnel require, number of labor to reduce, forecast future works,