This paper focuses on the application of system dynamics in the integration of knowledge management (KM) and human resource management (HRM) with specific reference to the determination of the optimum setting of time-based policy parameters. The integration of KM and HRM is w.r.t. the engineering competence pool development and deployment. The feedback as well as feed-forward loops were used in the development of the control loops, which govern the simulation carried out in two distinct stages. In both the stages, the influence of the governing time-based policy parameters has been studied to investigate the critical parameters, which significantly influence the effectiveness of the system. The simulation results envisage the effect of the policy parameters, based on which implications are drawn for better policy evaluation and control. Even though the study has a national context, the procedure adopted in this research has the potential to be extended to the global level.