1.
THE PURPOSE OF EMPLOYEE PLANNING AND FORECASTING
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THE PURPOSE
OF EMPLOYEE PLANNING AND FORECASTING
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Employee planning and forecasting
represents an integral part of the human resources management
process.
Job descriptions
and job specifications are widely used by management throughout
the Employee Planning And Forecasting Process.
The main purpose of the employee planning and forecasting process
is to secure the availability of specific types of people with
the skills, experience, and background necessary to meet the company's
forthcoming objectives.
The actual employee planning and forecasting process
consists of two stages, as illustrated below.
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THE EMPLOYEE
PLANNING AND FORECASTING PROCESS
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Stage 1: Employee
Demand Forecasting
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Stage 2: Employee
Supply Forecasting
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2. EMPLOYEE DEMAND FORECASTING
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ELEMENTS
OF EMPLOYEE PLANNING AND FORECASTING
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Employee Planning
deals with short- and long-term forecasting issues and is designed
to provide sufficient information about employee requirements in
the future, as illustrated below. |
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EMPLOYEE
DEMAND FORECASTING
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Short-Term
Employee Demand Forecasting
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Long-Term
Employee Demand Forecasting
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This is designed to assess the level of employee requirements
to enable the company to meet its objectives during the forthcoming
fiscal year. This type of forecasting has an immediate effect
on the company's current situation.
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This provides an optional indication of the company's future
requirements based on one- to five-year periods.
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3. SHORT-TERM EMPLOYEE
DEMAND FORECASTING
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SHORT-TERM EMPLOYEE DEMAND FORECASTING
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It is appropriate to begin the Short-Term Employee Demand Forecasting with a
detailed analysis of current employee allocation.
This involves completing an Employee
Allocation Status Report and summarizing relevant details about employees in various
departments, sections, and shops. A typical Employee Allocation Status Report is
presented below. This report also indicates the possible need for replacing a particular employee, based on the
employee's past performance evaluation. Various methods of
employee performance evaluation will be discussed later.
The next stage in short-term employee
demand forecasting entails examination of the
company's immediate operational objectives and assessment of relevant human
resources requirements. The main factors which should be considered during this examination are
outlined next.
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SHORT-TERM EMPLOYEE
DEMAND FORECASTING FACTORS
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No.
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Details
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1
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Current corporate budget.
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2
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Current production requirements.
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3
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Current sales demands.
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4
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Current economic situation.
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5
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Current capabilities of employees.
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EMPLOYEE
REQUIREMENTS REPORT
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Upon completing the examination of all short-term employee
demand forecasting factors, management should prepare a detailed Employee
Requirements Report for the forthcoming fiscal period. This report contains detailed information
summarizing the specific human resources requirements.
A typical
example of Employee Requirements Report for a small business is also presented below.
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4. SMALL BUSINESS EXAMPLE:
EMPLOYEE ALLOCATION STATUS REPORT
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Work Center
Department,
Section, Shop
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Name Of Employee
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Current
Position
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Work
Period (Years)
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Annual Income ($)
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Need To Be Replaced?
Yes/Maybe/No
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Admin. Dept.
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A. Boss
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President
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10
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100,000
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No
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Admin. Dept.
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B. White
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Secretary
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4
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34,000
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No
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Admin. Dept.
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C. Green
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Receptionist
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0.5
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27,000
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Yes
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Fin. Dept.
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D. Brown
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VP Finance
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5
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70,000
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No
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Fin. Dept.
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E. Gray
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Bookkeeper
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4
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37,000
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No
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Fin. Dept.
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F. Rose
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Filing Clerk
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1
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26,000
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Yes
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Prod. Dept.
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G. Black
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VP. Production
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7
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67,000
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No
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Prod. Dept.
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F. Blue
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Foreman
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5
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40,000
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No
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Sales Dept.
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K. Violet
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VP. Sales
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3
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43,000
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No
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Sales Dept.
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L. Pink
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Sales Person
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2
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38,000
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No
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Sales Dept.
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O. Orange
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Sales Person
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1
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37,000
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Yes
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Name: A. Boss
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Position: President
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Date: March 1, 2001
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5. SMALL BUSINESS EXAMPLE:
EMPLOYEE REQUIREMENTS REPORT
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Work Center :
Department,
Section, Shop
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Position
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Annual
Compensation
( $ )
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Fringe
Benefits
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When
Required?
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Admin. Dept.
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Receptionist
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25,000
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Med. Insurance
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Immediately
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Financial Dept.
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Invoice Clerk
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24,000
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Med. Insurance
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Immediately
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Prod. Dept.:
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Press Shop
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Operator
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28,000
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Med. Insurance
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Immediately
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Press Shop
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Operator
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28,000
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Med. Insurance
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August 2001
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Machine Shop
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Operator
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30,000
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Med. Insurance
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Immediately
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Machine Shop
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Operator
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30,000
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Med. Insurance
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August 2001
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Assembly Shop
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Operator
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28,000
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Med. Insurance
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Immediately
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Sales Dept.
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Sales Person
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40,000
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Med. Insurance
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Immediately
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Sales Dept.
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Sales Person
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40,000
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Med. Insurance
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August 2001
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Name: A. Boss
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Position: President
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Date: January 1, 2001
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EMPLOYEE SUPPLY
FORECASTING |
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EMPLOYEE
SUPPLY FORECASTING
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Once all employee requirements for the forthcoming fiscal period
are summarized, management should proceed with identifying appropriate
sources of employee supply. This task represents an integral part
of the process known as Employee Supply
Forecasting.
The process of employee supply forecasting requires
that management identify the hidden
talents of the people already employed by the company. This provides the employees with
the opportunity for continuous challenge and development.
In order to keep track of the
employees' qualifications and development, it is necessary to introduce and maintain an
updated Employee Record System. There are several types of systems applicable for
this purpose, as illustrated below.
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Management
Replacement Chart
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Employee
Record
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7. MANAGEMENT REPLACEMENT CHART
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MANAGEMENT
REPLACEMENT CHART
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Another important element of a employee record system is the
Management
Replacement Chart.
The Management Replacement Chart includes names of several candidates for the most
important positions within the organization and summarizes present performance and
promotion potential for each candidate.
A typical Management Replacement Chart is
presented next.
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8. SMALL BUSINESS EXAMPLE:
MANAGEMENT REPLACEMENT CHART
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9.
EMPLOYEE RECORD
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EMPLOYEE
RECORD
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Employee Record
contains information that is compiled on each employee within
the organization. This record includes information such as details of education,
professional courses, career and development interests, additional training requirements,
and details of skills and experience.
A typical Employee Record in a small or
medium-sized company is presented below.
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10. SMALL BUSINESS EXAMPLE:
EMPLOYEE RECORD
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11. FACTORS WHICH INFLUENCE THE AVAILABILITY OF EMPLOYEES
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AVAILABILITY
OF EMPLOYEES
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Sometimes management will not be able
to find suitable Candidates within the organization to fill certain
positions. In this instance, management must ensure that
candidates are available from external sources.
The availability of suitable candidates
depends upon several factors, as outlined below.
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FACTORS
WHICH INFLUENCE THE AVAILABILITY OF EMPLOYEES
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• General Economic Conditions.
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These conditions depend upon overall economic
conditions in the country, rate of unemployment, and anticipated
economic trends.
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• Local Labor Conditions.
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These conditions depend upon the economic
situation in a specific city, county, or state.
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• Occupational Market Conditions.
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These conditions depend upon the availability
and demand for professional people, such as engineers, accountants,
computer programmers, and trade people.
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12. ADVANTAGES OF THE EMPLOYEE
PLANNING PROCESS
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ADVANTAGES
OF THE EMPLOYEE PLANNING PROCESS
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The main advantage of the Employee Planning Process is that it
enables management to make correct decisions regarding the company's
needs for employees who can meet the company's objectives.
Moreover, the employee planning process helps management
to deal more effectively with several important issues, as outlined
below. These issues represent an integral part of the human
resources management process and will be discussed in details
later.
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APPLICATION OF THE EMPLOYEE
PLANNING PROCESS
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No.
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Details
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1
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Employee hiring.
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2
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Employee training.
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3
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Design of career management programs.
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4
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Design of productivity programs.
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5
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Design of sales programs.
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6
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Employee organization programs.
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13. FOR SERIOUS
BUSINESS OWNERS ONLY
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Reprinted with permission. |
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