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Chapter 6
Determining HR Demand
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Learning Outcomes
After reading this chapter, you should be able to:
Understand the importance of demand forecasting in the HR planning process
Recognize the linkages between the HR plan, labour demand forecasting techniques, and the subsequent supply stage
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HR Demand
HR demand: The organization’s projected requirement for human resources
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4. Two Approaches to HR Demand
Quantitative
Trend/Ratio analysis
Regression analysis
Qualitative
Envelope/scenario planning
Impact analysis
Delphi technique
Nominal group technique
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Trend Analysis
Trend analysis: Reveals the historical relationship between an operational index and the number of employees required by the organization (demand for labour)
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Ratio Analysis
Ratio analysis: A quantitative method of projecting HR demand by analyzing the relationship between an operational index and the number of employees required
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Trend/Ratio Analysis
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Regression Analysis
Regression analysis: Very effective, quantitative forecasting technique for short-, medium-, and long-range time horizons
Can be easily updated and changed
Uses SPSS or SAS
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HR Budgets
HR budgets: Quantitative, operational, or short-run demand estimates that contain the number and types of personnel required by the organization as a whole and for each sub-unit, division, or department
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10. HR Budgets: Staffing Table
Staffing table: Total HR demand requirements for operational or short-run time periods
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11. HR Budgets: Staffing Table
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12. Two Approaches to HR Demand
Quantitative
Trend/Ratio analysis
Regression analysis
Qualitative
Envelope/scenario planning
Impact analysis
Delphi technique
Nominal group technique
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13. Envelope/Scenario Forecasts
Envelope/scenario forecasts: Projections, or multiple-predictor estimates, of future demand for personnel predicated on a variety of differing assumptions about how future organizational events will unfold
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14. Envelope/Scenario Forecasts
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Impact Analysis
Impact analysis: A forecasting method in which past trends are analyzed by a panel of experts to predict future HR demand
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Delphi Technique
Delphi technique: A process in which the forecasts and judgments of a selected group of experts are solicited and summarized in an attempt to determine the future HR demand
Usually do not meet in person; predictions anonymously circulated and revised
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17. Nominal Group Technique
Nominal Group Technique: Long-run forecasting technique utilizing expert assessments
Usually do meet and jointly determine forecast
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