Week 3 Project

South University

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Forecasting Human Resources The need to determine future HR supply requirements is a critical function for every organization. Future employment needs within an organization must be carefully planned and managed to determine whether an organization can meet the demand for personnel replacement from current employees in the organization or must go outside of the organization. Forecasting is the process of predicting a future event based on historical data. Forecasting can include educated guessing. It is the underlying basis of all business decisions, including production, inventory, facilities, and, of course, labor supply. HR uses forecasting to determine its labor supply needs.

Organizational demand for labor supply is available from two sources or a combination of these two: internal (current employees) and/or external (recruiting people outside of the organization). There are various techniques available to HR management that are used to analyze labor supply. Organizations use management inventories and employee skills inventories to determine how it might meet its labor demand requirements from its current base of employees. In addition, succession planning allows the organization to identify qualified internal replacements.

Linear programming is used to measure the best outcome such as maximum profits or lowest costs. It is used by HR planners to determine the future supply of personnel based on achieving the best staffing outcome while taking into account certain constraints such as labor costs.

Movement analysis is used to analyze the chain or ripple effect that promotions or job losses have on the movements of other personnel within an organization. HR planners use movement analysis to select the desired mix or percentage of internal versus external supply for those positions requiring replacements.

Forecasting is the process of making statements about events whose actual outcomes have not yet been observed. HR forecasting is about estimating the future demand and supply of human resources within an organization.

Additional Materials

From your course textbook, Managing Employee Performance and Reward (2nd ed.), read the following chapters:

Developing person-based base pay systems

Employee benefits

Overview of performance-related rewards

South University

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Individual performance pay plans

From the South University Online Library, read the following articles:

Who Will Be Where When? Forecast the Easy Way

An Opportunity Labor Demand Model and Markovian Labor Supply Models: Comparative Tests in an Organization

The Implementation of Workforce and Succession Planning in the Public Sector

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