tools for Forecasting demand and supply
Download as PPTX, PDF4 likes5,276 views
This document discusses various tools for forecasting demand and supply of human resources, including quantitative and qualitative techniques. Quantitative techniques for forecasting HR demand include trend analysis, ratio analysis, and regression analysis. Qualitative techniques include the Delphi method and nominal group technique. Tools for forecasting HR supply include trend analysis, skills/competency inventories, replacement charts, succession planning, staffing tables, and Markov analysis.
tools for Forecasting demand and supply
- 1. TOOLS FOR FORECASTING DEMAND AND SUPPLY GLADY K THOMAS glady.mba1214@gmail.com
- 2. A key component of HRP is forecasting the number and type of people needed to meet organizational objectives. A variety of organizational factors, including competitive strategy, technology, structure, and productivity can influence the demand for labour.
- 3. FORECASTING HR SUPPLY There are a variety of methods to forecast future HR supply. They include trend analysis, skills/competency inventories, replacement charts, succession planning, staffing tables, and Markov analysis.
- 4. TREND ANALYSIS A method of forecasting that assumes past trends and ratios in employee movement are stable and indicative of future trends and ratios in employee movement. For example, an organization reviewing historical data may realize that every year, approximately five percent of their staff retire, six percent resign, and three percent are dismissed. Using a simple trend analysis, future HR supply forecasts can be established by assuming an average reduction in internal HR supply of 14 percent per year.
- 5. Skills/Competency Models The skills/competency model is a future-oriented model that first reviews competencies that are aligned with an organization’s mission, vision, and strategy, and then aims to identify an ideal workforce in terms of those competencies.
- 6. Replacement Charts A chart used to estimate vacancies in higher level jobs and identify how potential HR supply can fill these vacancies via internal movements from lower levels jobs. A replacement chart includes information about employees’ performance, readiness to fill the position, and education. In some cases, a replacement chart will include information about an employee’s age, tenure, gender, and visible minority status in addition to required experiences, education, or skills needed for the position.
- 7. Succession Planning Succession planning focuses on identifying, developing, and tracking future leaders for executive positions or positions that are critical to the success of the organization. Succession planning is a longer-term process of grooming a successor (selected from a pool of candidates on the basis of perceived competency) for management or critical positions. An organization can use the skills inventory, HR audit, or a succession summary to help identify potential successors and skill gaps that can be addressed through succession planning.
- 8. STAFFING TABLES A clear graphical view of all organizational jobs and the current number of employees at each job. It presents a simple visual understanding of an organization’s staffing level within each department and the organization as a whole, in an effort to help understand the combination of employees that make up an organization’s internal workforce.
- 9. MARKOV ANALYSIS It helps to predict internal employee movement from one year to another by identifying percentages of employees who remain in their jobs, get promoted or demoted, transfer, and exit out of the organization. The Markov analysis also identifies areas of high turnover, specifically at general labourer and machine operator levels. It may be of interest to the organization to assess the causes of turnover at these levels and identify whether the turnover can be minimized.
- 10. FORECASTING HR DEMAND Demand analysis identifies the future workforce requirements needed to maintain the organization’s mission and goals.
- 11. QUANTITATIVE TECHNIQUES Trend Analysis It predicts the demand for labour based on projections of past relationship patterns over a number of years between an operational index. As a simple example, a hotel determines that each housekeeper can clean 20 rooms a day (an operational index). The hotel has 1,000 rooms and is projected to be at 100 percent capacity in the summer season, but 80 percent capacity in the fall season. In this example, the hotel would use trend analysis to determine that it will need 50 housekeepers for the summer season and 40 in the fall season.
- 12. RATIO ANALYSIS Analysis that determines future HR demand based on ratios between assumed casual factors and the number of employees needed. Ratio analysis is also useful in benchmarking organizational efforts with industry or competitive standards to help identify areas of strength or weakness in an organization.
- 13. REGRESSION ANALYSIS This method provides statistical projections using mathematical formulas to determine the correlation between multiple measureable output factors (independent variables) and an organization’s employment level (dependent variable). To effectively conduct a regression analysis, the planning team must have access to a large sample size of data (individual or group level data)
- 14. QUALITATIVE TECHNIQUES DELPHI METHOD A method of forecasting HR demand that involves a panel of experts using their judgements to make estimates of short-term future demands. Experts use a variety of factors to make their judgements, including economical, demographical, technological, legal, and social conditions outside of the organization, as well as production, sales, turnover, experiences, and education levels of the workforce within the organization.
- 15. Nominal Group Technique A method of forecasting HR demand that involves multiple experts (usually line and department managers) meeting face to face to discuss independently formulated positions of an organizational issue, with the ultimate aim of securing an accurate assessment of a given situation.
- 16. THANK YOU