Manpower Planning Module 2.pdf

Copyright © 2023 Jayanti Rajdevendra Pande. All rights reserved.
RASHTRASANT TUKDOJI MAHARAJ NAGPUR UNIVERSITY
MBA
SEMESTER: 3
SPECIALIZATION
HR
SUBJECT
MANPOWER PLANNING, RECRUITMENT & SELECTION
MODULE NO : 2
MANPOWER FORECASTING
- Jayanti R Pande
DGICM College, Nagpur

Q1.What is manpower forecasting? Explain its needs & benefits.
INTRODUCTION OF MANPOWER FORECASTING
Manpower forecasting, also known as workforce forecasting or human resource forecasting, is a crucial strategic planning
process in organizations. It involves predicting future workforce needs based on business goals and growth projections.
DEFINITION
Manpower forecasting is the process of predicting the future workforce needs and available resources of an organization.
A SUCCESSFUL MANPOWER PLAN
Estimating Manpower Demand:The first step in manpower forecasting is to analyze the organization's future business plans
and growth projections.This analysis helps determine the workforce required to achieve those objectives, considering factors
such as market demand, technological advancements, and industry trends.
Ensuring Manpower Supply:The next step involves assessing the existing workforce and talent pool within the organization.
This assessment evaluates employees' skills, training needs, and potential for advancement. External recruitment sources may
also be considered.
A successful manpower plan ensures a balance between manpower demand and supply. If demand exceeds supply, the
organization focuses on hiring and training. If supply exceeds demand, options like redeployment or attrition are considered.

NEED OF MANPOWER FORECASTING
1.Addressing Hiring Delays: Manpower forecasting helps overcome hiring process delays, ensuring a timely availability of
skilled workforce.
2.Tackling Labour Market Uncertainties: Forecasting manpower needs assists in dealing with talent shortages and labor
market uncertainties through strategic recruitment and training efforts.
3.Planning for Specific Workforce Skills: Understanding labor substitutability enables effective planning for skill-specific
workforce requirements to meet changing business demands.
BENEFITS OF MANPOWER FORECASTING
1.Cost-Effective HR Management: Accurate forecasting minimizes HR costs by aligning workforce needs with actual
demand, reducing recruitment and training expenses.
2.Enhanced Organizational Adaptability: Forecasting allows quick adaptation to changing business environments by
ensuring the availability of the right talent at the right time.
3.Proactive Resource Planning: MPF enables proactive planning for resource constraints and security concerns, preventing
operational disruptions.
4.Better Business Alignment: Integrating manpower forecasting with overall business forecasting enhances alignment
between workforce planning and broader organizational goals.

Q2. Describe HRP at different levels.
HRP AT 6 DIFFERENT LEVELS
NATIONAL LEVEL: At the national level, human resource planning is carried out by the government. It involves forecasting
the demand and supply of manpower across the entire nation.The government aims to ensure a balanced and skilled
workforce to support the country's economic and social development.
SECTORAL LEVEL: At the sectoral level, human resource needs are determined for specific sectors, such as industrial,
agricultural, or tertiary sectors.The requirements are based on factors like expected output, operational demands, and
government policies related to each sector.
INDUSTRY LEVEL: At the industry level, human resource requirements are projected based on the output level and growth
prospects of particular industries, such as textile, chemical, cement, etc. Industry-specific factors and workforce demands are
considered to meet production targets.
UNIT LEVEL: At the unit level, human resource requirements are evaluated based on the business plans and objectives of a
specific organization or company. It involves analyzing the workforce needs to support the organization's goals and growth.
DEPARTMENTAL LEVEL: At the departmental level, manpower requirements are determined for individual departments
within a company.The focus is on identifying the skills and personnel needed to fulfill departmental functions and
responsibilities.
JOB LEVEL: At the job level, human resource forecasting focuses on determining the HR needs of particular professions or job
roles within a department. For example, it involves assessing the demand for mechanical engineers in the mechanical
department based on project requirements and workload.

Q3 Explain the process of Human Resource Planning [HRP]
1 ENVIRONMENTAL SCANNING
2 DEMAND AND SUPPLY FORECASTING
3 ESTOMATING MANPOWER GAP
4 ACTION PLANNING
5 EVALUATION & CONTROL

1. ENVIRONMENTAL SCANNING (Analysing the Business Environment) The first step involves analysing the
organization's internal and external factors. It helps to identify potential opportunities, threats, strengths, and
weaknesses.
2. DEMAND & SUPPLY FORECASTING : Demand Forecasting:This step assesses the expected quantity and quality of
manpower required within the organization. It considers current HR numbers and organizational plans.
Supply Forecasting: Here, the availability of manpower and potential sources for recruitment are estimated. It includes
considering internal candidates, external hiring, and factors like absenteeism and internal mobility.
3. ESTIMATING MANPOWER GAPS Manpower gap analysis compares the projected workforce supply with the estimated
demand. Factors like geographic location, demographic characteristics, and employee competency levels are evaluated.
Identified gaps serve as the basis for formulating action plans.
4. ACTION PLANNING Immediate steps are taken to address any identified gaps between HR demand and supply.The
organization adopts appropriate strategies like downsizing, rightsizing, restructuring, or implementing recruitment,
selection, training, and incentive programs based on the situation.
5. EVALUATION & CONTROL MECHANISM HRP must have specific targets to be achieved. Regular evaluation and control
involve reviewing decisions and involving top-level individuals. HR performance is monitored through budgetary
assessments, efficiency evaluations, and surveys. Key metrics such as productivity, turnover, employee satisfaction, and
other relevant ratios are analysed. Exit interviews provide valuable insights for improvements.

Q4 Write about integration of Strategic Planning with HRP.
INTEGRATION OF STRATEGIC PLANNING WITH HUMAN RESOURCE PLANNING (HRP)
By seamlessly integrating strategic planning with HRP, organizations can optimize their workforce to drive success and
adapt to changing business needs effectively.
Executing Plan
 Integrate HRP with strategic goals to ensure the
right workforce is available to execute the
organization's vision.
 Align HR strategies with strategic priorities to
support long-term success
Feedback and Monitoring
 Regularly monitor HRP's progress in achieving
HR goals that align with the strategic plan.
 Gather feedback on workforce performance,
talent development, and succession planning.
Impact Assessment
 Evaluate the impact of HRP on the organization's
overall strategic success.
 Assess how well the HR strategies and workforce
align with the achievement of strategic
objectives.
Course Correction
 Use the feedback and impact assessment to
make necessary adjustments to HRP and HR
strategies.
 Implement course corrections to ensure
alignment with evolving strategic goals.

Q5.What is supply forecasting and write about different models & techniques of it.
SUPPLY FORECASTING: Supply forecasting is a process used in Human Resource Planning (HRP) to estimate the
availability of the workforce from both internal and external sources. It helps organizations determine whether they have an
adequate number of employees with the required skills and competencies to meet future demand.
DIFFERENT MODELS &TECHNIQUES OF SUPPLY FORECASTING:
3 Skill Inventories
1 Markov Analysis
5 Manning Charts or StaffingTables
4 Succession Planning
6 Replacement Planning
2 Cohort Analysis

1. Markov Analysis: Markov Analysis is a statistical technique that predicts workforce movements across different job
categories or positions over time. It considers historical data on promotions, transfers, and exits to estimate the future
workforce distribution and identify potential skill gaps.
2. Cohort Analysis: Cohort Analysis involves grouping employees based on common characteristics such as age, tenure, or
skills. By analyzing the behavior of different cohorts over time, organizations can project future workforce availability and
assess potential challenges in talent supply.
3. Skill Inventories: Skill inventories involve maintaining detailed records of employees' skills, qualifications, and
experiences.This database allows HR managers to identify skill strengths and shortages, enabling more accurate supply
forecasting and targeted training programs.
4. Succession Planning: Succession planning identifies and develops internal talent to fill key leadership and critical
positions in the organization. By grooming potential successors, companies can ensure a continuous supply of qualified
individuals to meet future workforce needs.
5. Manning Charts or StaffingTables: Manning charts or staffing tables help visualize workforce supply and demand by
department, job category, or skill set.These graphical representations assist in identifying imbalances between workforce
availability and requirements.
6. Replacement Planning: Replacement planning focuses on identifying potential candidates to replace employees in
crucial roles when needed.This proactive approach ensures a ready pool of qualified individuals to maintain business
continuity.

Q6.What is matching supply & demand forecasting?
MATCHING SUPPLY & DEMAND FORECASTING:
Matching supply and demand forecasting is a pivotal component of Human Resource Planning (HRP) that involves aligning
the available workforce (supply) with the anticipated workforce requirements (demand) of an organization.This
synchronization ensures that the right number of employees possessing the necessary skills and competencies are accessible
when needed, facilitating the organization's seamless operational continuity.
1. Demand Equals Supply: In this equilibrium scenario, the organization's workforce matches the workload effectively.
There is a harmonious balance between the number of employees and the tasks at hand, fostering operational stability.
2. Demand LessThan Supply:When there is an excess of workforce (supply), strategic measures are deployed to optimize
human resources, including:
• Restricted Hiring:Temporarily limiting new recruitments.
• Reduced Hours: Implementing part-time schedules for existing employees.
• Layoff:Temporarily or permanently releasing surplus employees.
• Early Retirement: Encouraging senior employees to retire early, aligning the workforce with demand.
3. Demand GreaterThan Supply: In instances of workforce shortage, proactive strategies are adopted to ensure talent
availability, such as:
• Compensation Incentives: Offering attractive compensation packages.
• Creative Recruitment: Exploring innovative recruitment methods.
• Different Selection Standards: Modifying selection criteria to broaden the candidate pool.

Q7.What is action planning?
ACTION PLANNING
• Action planning refers to the immediate step taken to bridge the gap identified between the estimated demand and
supply of workforce in Human Resource Planning (HRP).
• When the HRP process reveals a disparity between the projected demand for employees and the available supply, action
planning is initiated to address this discrepancy effectively.
• The primary focus of action planning is to develop and implement specific strategies and initiatives to ensure that the
organization has the right number of skilled employees at the right time. Based on the gap analysis between the required
workforce and the available workforce, the action plan may involve:
 Recruitment Strategies: Implementing targeted recruitment efforts to attract qualified candidates and fill vacant
positions promptly.
 Training and Development Programs: Providing training and upskilling opportunities to existing employees to enhance
their competencies and meet the organization's changing demands.
 Retention Initiatives: Implementing measures to retain key employees and reduce turnover rates.

Q8. What is environmental scanning?
ENVIRONMENTAL SCANNING: [Analysing the Business Environment]
Environmental scanning is a critical strategic management process that involves analysing both internal and external
factors of an organization to identify potential opportunities, threats, strengths, and weaknesses.
It is the first step in the process of staying informed about the business environment and making informed decisions to
ensure the organization's success and sustainability.
1. Internal Factors:
Internal factors pertain to the organization itself and include an assessment of its resources, capabilities, and current
performance.This analysis helps identify the organization's strengths, such as unique skills, technologies, or competitive
advantages, which can be leveraged for growth and success.Additionally, it identifies weaknesses that may hinder the
organization's performance and need to be addressed.
2. External Factors:
External factors refer to the broader business environment beyond the organization's control.This includes analyzing the
market, industry trends, regulatory changes, economic conditions, and competitor activities. Identifying external
opportunities allows the organization to capitalize on emerging trends, new markets, or potential collaborations.
Simultaneously, recognizing external threats helps the organization proactively address challenges and develop strategies
to navigate uncertainties.

Q9 What is Demand Forecasting? What are the factors and techniques of demand forecasting?
1
TREND
ANALYSIS
2
RATIO
ANALYSIS
4
ECONOMETRIC
METHODS
3
REGRESSION
ANALYSIS
5
SCATTER
PLOT
8
MANEGERIAL
JUDGEMENT
10
NOMINAL
GROUP
TECHNIQUE
9
DELPHI
TECHNIQUE
6
WORK
STUDY
TECHNIQUE
7
COMPUTERISED
FORECAST
TECHNIQUES OF DEMAND FORECASTING

DEMAND FORECASTING
Demand forecasting is the process of estimating future workforce requirements to meet the organization's operational
needs. Demand forecasting is a crucial process in Human Resource Planning (HRP) that helps organizations estimate their
future workforce requirements.
TECHNIQUES OF DEMAND FORECASTING
1.Trend Analysis:This method forecasts employment requirements based on past organizational indices. It involves two
sub-methods:
•Extrapolation: Examines historical data trends and cycles, using mathematical techniques to project them into the future.
•Indexation: Matches employment growth with an index for a preliminary assessment of HR requirements.
2. Ratio Analysis:This technique computes ratios between a specific business factor and the number of required
employees. It provides a clearer picture than trend analysis.
3. Regression Analysis:This measures the degree of correlation between variables to forecast staffing requirements based
on measurable indicators like output or revenue. Linear regression involves using a straight line to depict mean values.
4. Econometric Method: Analyzing past statistical data to describe relationships between variables in mathematical and
statistical terms. Equations are derived to project future staffing requirements based on factors like investment,
profitability, and product quality.

5. Scatter Plot: Identifies the relationship between two variables, such as business activity and staffing levels, to
estimate personnel requirements.
6.Work StudyTechnique: Based on the volume of operations and personnel efficiency, this technique derives
aggregate manpower requirements.
7. Computerized Forecast: Uses computer software to determine future staff needs based on projected sales and
production volumes.
8. Managerial Judgment: Managers collaboratively estimate future labour demand based on guidelines, departmental
inputs, and committee review.
9. DelphiTechnique: Involves rounds of surveys with expert participation, where feedback from initial rounds informs
subsequent ones until an appropriate consensus is reached.
10. Nominal GroupTechnique: Experts meet face-to-face, make independent forecasts, discuss, revise, and eventually
arrive at a single forecast.

FACTORS AFFECTING DEMAND FORECASTING
Demand forecasting involves estimating future workforce requirements to align with organizational needs. Several
factors influence this process:
1. Organizational Structure:The structure of an organization impacts its workforce requirements. A flat organization
may need fewer employees, while a complex one may demand a larger workforce.
2. Location: Different locations may have varying talent pools and labor market conditions, affecting the demand for
specific skills and competencies.
3. Business Conditions: Economic conditions, market trends, and industry fluctuations can significantly impact
workforce demand. In growth periods, higher demand may necessitate more hiring.
4. Expansion Plans: Organizational growth strategies, like entering new markets or expanding operations, directly
influence future workforce needs.
5. Outsourcing: Decisions to outsource certain functions may alter the demand for in-house staff.

Copyright © 2023 Jayanti Rajdevendra Pande.
All rights reserved.
This content may be printed for personal use only. It may not be copied, distributed, or used for any other
purpose without the express written permission of the copyright owner.
This content is protected by copyright law. Any unauthorized use of the content may violate copyright laws and
other applicable laws.
For any further queries contact on email: jayantipande17@gmail.com

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