HR FORECASTING
Types of HR forecasting activity Benefits of HR forecasting activity Personnel involved in HR forecasting activity Impact of environmental and organisational variables on HR forecasting activity Identify various stages in determining HR demand Policy & programme implementation of an HR deficit or HR surplus
Types of HR forecasting activity
Event Based
Forecasting Activity
Transaction Based Process Based
Types of HR forecasting activity
Event based- Forecasting concerned with changes in external environment Transaction based-Forecasting concerned with changes in internal environment Process based- Forecasting based on the flow or sequencing of several work activities
Benefits of HR forecasting activity
Reduces HR costs by curtailing last minute crisis Increases flexibility by giving more viable options Ensures a close linkage to macro business forecasting process Helps in concentrating on the organisational goals rather than contingency planning
Personnel involved in HR forecasting activity
Specialist
Managers/ Executive
Recruits
Designated group
Organisational Factors
Corporate mission statements Operational goals, production budgets HR policies Organisational Structure, restructuring, mergers Worker KSA/ competencies HRMS level of development Organisational culture, workforce climate and satisfaction Job analysis
External /Environmental Factors
Economic situation Labour market and unions Governmental laws and regulations Industry and Product life cycle Technological changes Competitor labour usage Global market for skilled labour Demographic changes
Types of forecast
Up to 1 year
Current
1 2 years
Short Run
2 5 years
Medium Run
More than 5 years
Long Run
Outcome Of Forecast
Prediction A single numerical estimate of HR requirements associated with a specific time horizon and set of assumption. Projection It incorporates several HR estimates based on variety of assumption
HR Forecasting Process
Identify organisational goals, objectives and plans Determine HR Demand Ascertain HR Supply Determine the net HR requirements
Develop HR plans and programs to ensure that the right people are in the right place
Determine HR Demand
Requirements of personnel by each subunit
These subunits are to be aggregated Planned future changes to be incorporated Replace non productive paid time State net HR demand State final cost estimate
Ascertain HR Supply
Two supply options-
Internal Supply
Current members of workforce who can be retained, promoted, transferred etc to fill anticipated HR requirements
External Supply
Potential employees who are currently undergoing training
Determine net HR requirement
HR demand = external supply+ internal supply or, HR demand- internal supply = external supply Where, External supply requirement = replacement +change supply Where, Replacement supply =hiring to replace all normal losses Change supply = hiring to increase (or decrease) the overall staffing level Thus, External supply = Current workforce size x (replacement % per year + change % per year )
Develop HR plans and programs to ensure that the right people are in the right place
When a forecast of HR demand is reconciled with the current workforce supply of personnel the result is net HR requirement. Disparity results intoHR deficit= HR demand >HR internal supply HR surplus= HR demand <HR internal supply
Remedial action for HR deficit and HR surplus
HR deficit oRecruitment oLaid off workers oRetired employees oTemporary workers HR surplus oLay off oTerminate employees with old skill set oJob sharing with less pay oReducing no. of shifts or hours oAttrition oHiring freeze oEarly retirement packages
