1.

Objectives of Finance department

The business goal of the finance department in Buddha Air is to achieve higher and more
consistent profitability than achieved in the past. In Finance department, Buddha airline has two
departments:

I. Finance and budget control system: This system records revenues and expenses prepare and
generate its ledgers, trial balance, profit, loss account and balance sheet. And with the budget
control system, expenses are controlled.
II. Revenue Accounting System: This system based on cash value documents like passenger
ticket, Cargo coupon and excess baggage coupon that is used to generate revenue.

2. Present human resource in Finance department (Year 0)

There are 26 total staff member presently working under the finance department. With only a
staff in Executive, 2 in manager position, 9 as an officer, 14 as supporting staff. The shortage of
human resources is seen in terms of quality and competency required for job.

3. Forecasting Demand and supply of human resources in the finance department

Buddha Air is a dominant company among the other Nepali airline industry. It is planning to
increase its market share from 60% to 80%. To maintain and strengthens the competitiveness of
Buddha airlines, it must strategies its position in the market both internally and externally. To
expand and enhanced its services, Buddha air has to broaden its services all over Nepal. For this
they need to train and hire more number of employees.

In the first year of its services, Buddha air is planning to strengthen its financing department by
hiring and adding number of employees so, it is the role of Human resource Department to
analyze the requirement of human resource in finance department. For this, the need for human
resources is assumed to be as follows:
 ● Internal Promotion is the main thing we are doing in Buddha Airlines to enhance more
dedication on work and to motivate the employees. We will be training and hiring
employees who are sitting idle in other department.
● In the first year, we are decreasing the size of employees in marketing department as we
think that there are not much functions marketing department need to carry out. We are
planning to include 45 employees in financial services in the first year. External
recruiting is required in this department to gain skilled and experienced employees.

4. Forecasting Demand and Supply of Human Resource

Buddha Air has planned to procure two new aircrafts in near future. Also it plans to start
financial services in the Eastern region. The total number of current executives is 7, Managers
are 41, officers are 74, supporting employee are 146 and attendant are 18.
Since Buddha airline has planned to start cross-border flights in near future, additional employee
are required in each department. So each year we require extra human resource to grow and
expand the airline. By the year 3, the required executives are 11, managers we required are 62,
required officers are 114, we require supporting officers 203 and attendant 144 in respective
department as shown in the excel.
In year 1, there are total 386 numbers of existing staff whereas the total of 426 numbers of staff
is required. So there is the shortage of 40 staffs in year 1
In year 2, Buddha year has 426 numbers of existing staff and total required staff is 486. There is
the shortage of 60 staff.
In year 3, the existing number of staff is 486 and required staff is 534, there should be additional
48 staff.
Meanwhile there was turnover of the staff in Buddha air in each year with 19, 21 and 24 number
of staffs respectively. Because of turnover of staff causes shortage of human resources in each 3
year, i.e., 59, 81, and 72 respectively.

5. Estimating Manpower Gaps

There is shortage of human manpower in Buddha airlines. In year 2 and year 3 the demand
forecast is 486 and 534 respectively. But the number of staff actually available is 405 and 462.
So, there is shortage of human resources in all three years of Buddha Airlines. In year 1 there is
shortage of 59 employees whose rate increases in year 2 with 81 employees and in year three 72.
So to balance its demand with supply Buddha Airlines must formulate an action plan to recruit
human resources. Extensive use of proper training and development program can be done to
enhance the skills of employees so that they can fit in every department.
In year 2, a STOL service is planning to add for which extra operation, marketing and
engineering functions is required. Also, finance services are extending two more branches in
Dharan and Birtamod. So demand of human resources in this department will be high. We are
estimating the size of employees from 45 to 76 in year 2 in financial services. In addition,
Buddha Airlines is planning to expand its market and start to operate internationally in year 3.
The adjustment of employees in every department is crucial. Finance sector has added three
more branches and the employee’s size are estimated to be 105.

6. Formulating the Human Resource Action Plan

There is the shortage of human resource in the organization. To fill the gap, the organization may
have the following option:
I. Recruitment of new employee
Since the airline is planning to grow and expand, as shown in the excel part, the airline has a
shortage of human resources. So recruitment of new employee could be the one option to fill the
deficit gap. The recruitment could be done either internally or externally. To hire human resource
internally, promotions of employee can be done by providing training, go for the employee
referrals, or re-recruit former employees and applicants.

To meet the estimated growth rate of 15 % in year 2 and year 3, company must retain its existing
employees for the future growth. The company needs to hire more skilled and technical
employees. Internal workforce is not sufficient to balance the gap of demand and supply. So the
external sources like recruiting from universities, employment agencies could be an option to
meet the gap.

II. Interdepartmental transfer

In the first year, we have reduced the size of human resources in marketing department. We can
include these resources in financial services. We need employees for personal loan, real estate
housing, personal loan, deposit and operation, audit and many more. HR planning is done on the
basis of these requirements.

7. Monitoring control and Feedback

Key to successful implementation is constantly measuring, monitoring and reporting on progress,
and responding to changing circumstances. This step involves implementation of the human
resource action plan. Human resources are allocated according to the requirements, and
inventories are updated over a period. The plan should be monitored strictly to identify the
deficiencies and remove it either by recruiting new employee or interdepartmental transfer.
● Ensure that the human resource plan and its actual implementation is done to ensure the
appropriate action and the availability of the required number of employees for various
jobs.
● Establish a process that allows for regular review, adjustments and communication of
changes.