Textbook Notes (362,870)
Canada (158,081)
York University (12,350)
HRM 3430 (82)
Chapter 7

Chapter 7 - HR Demand

7 Pages
Unlock Document

York University
Human Resources Management
HRM 3430
Gordon Qi Wang

Chapter 7 There are five methods for determining HR demand: 1. Index/Trend Analysis 2. Regression Analysis 3. Envelope/Scenario Forecasting 4. Delphi Technique 5. Nominal Group Technique Organizations must consider demand for personnel not only for the current operational period but also well into the future to ensure that the right numbers of workers with the requisite skills and competencies are ready and available to work when the organization requires them to. Methods Quantitative Qualitative Index/Trend Analysis Yes Regression Analysis Yes Envelope/Scenario Forecasting Yes Yes Delphi Technique Yes Nominal Group Technique Yes Index/Trend Analysis • Demand for labour = number of employees in workforce There are five steps to conducting an effective index/trend analysis: 1. Select the appropriate business/operational index that is: a. Known to have a direct influence on the organizational demand for labour b. Subjected to future forecasting as a result of the normal business planning process • Business/Operational index o Level of sales o Number of units produced o Number of clients serviced o Production hours (direct labour) 2. Track the business index over time Once the business index is selected, it is important to record the quantitative or numerical levels of the index over time. Data from at least the past four or five year is necessary. Preferably data from the past decade or more should be used. 3. Track the workforce size over time Record the historical figures of the total number of employees or the amount of direct or indirect labour (HR Staff) for exactly the same period used for the business index. 4. Calculate the average ratio of the business index to the workforce size Employee Requirement Ratio = operational index/demand for labour This is done for each year to describe the relationship between the two variables over time. 5. Calculate the forecasted demand for labour Divide the annual forecast for the business index by the average employee requirement ratio for each future year to get the forecasted annual demand for labour. Y = (X) (R) Y= business/operational index X = demand for labour R = requirement ratio for each Regression Analysis • Regression analysis presupposes that a linear relationship exists between one or more independent (causal) variables, which are predicted to affect the dependent (target) variable. • Very effective quantitative forecasting technique for short, medium and long range time horizons • Can be easily updated and changed Envelope/Scenario Forecasting • Projections or multiple predictor estimates, of future demand for personnel based on a variety of differing assumptions about how future organizational events will unfold. • Because we have no certain knowledge of the future course of events, we would be well served by developing several plausible sets of outcomes. • Each scenario contains its own set of assumptions, resulting in an entirely different estimate presented in a single staffing table for each specific course of action. • The organization’s HR staff are able to develop, future scenarios that are optimistic (sales will increase by 20%) realistic (sales will increase by 10 %) or pessimistic (sales will remain constant or increase by 5%) Delphi Technique The Delphi technique is a qualitative method for deriving detailed assumptions of long- run HR demand. • A carefully designed program of sequential, individual interrogations (usually conducted through questionnaires) interspersed with information feedback on the opinions expressed by the other participants in previous rounds • Key feature  Once a group of experts are selected, they do not meet face to face There are six steps associated with using the Delphi technique for HR demand forecasting: 1. Define and Refine the issue or question A project coordinator is assigned and he/she works with HR staff to determine the specific personnel category or activity that will be the focus of the Delphi technique. The group targeted for HR forecasting should be well defined so that relevant, focused and detailed feedback based on a minimum of assumptions can be derived. 2. Identify the experts, teams and time horizon The project coordinator along with the HR staff compile a team of individuals who are deemed to be experts with respect to the specific personnel grouping that requires a forecast. 3. Orient the Experts The orientation process of the experts includes an overview of the demand forecasting decision process. The experts are told either that there will be a predetermined number of questionnaire iterations or that the sequence will continue until a majority opinion exists among the experts. 4. Issue the First Round Questionnaire The project coordinator sends each expert the questionnaire by courier, fax, mail or email and includes a time frame for completing and returning it. Typically, this first questionnaire focuses on defining both the explicit assumptions made by each of the experts and the background rationale supporting his or her particular demand estimate.
More Less

Related notes for HRM 3430

Log In


Don't have an account?

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.