To understand the Techniques of Manpower Forecasting.

1. Manpower Planning and
Forecasting
chapter 1
SYBBA
HR SPECIALIZATION
406 C

2. 1.1.1 Introduction
 Human resource is the most important asset of an organisation
 Manpower planning is essential
 Manpower planning is an important managerial function
 Considered as a strategy for the acquisition, utilization,
improvement and retention of an enterprise human resources.
 Manpower planning has an adverse and long term effect on the
organization
 Improper planning leads to a degree in productivity, increase
in employees turn over, low morale of employees.
 Affects the organization functioning

3. 1.1.2 Meaning and Definition
 Manpower planning is deciding the number and type of human resources
required for job unit and company to carry out organizational activities
 Planning involves identifying staffing needs
 Planning involves meeting the future as well as current human resource
needs of a firm
 The organization determines its manpower needs and then select the
right mix of employees
 Manpower planning is having the right people in the right play, at the
right time doing the right kind of task.
 Planning provides maximum long term benefits to both the organization
and the individual.

4. • Definition
 Coleman has defined human resource as" The
process of determining manpower requirements
and the means for meeting those requirements
to carry out the integrated plan of the
organization".
 According to Ashwathapa,” Human resource
planning is the process of forecasting a firm's
future demand for, and supply of the right type
of people in the right number.”

5. W.S.Wistrom has prepared a series of
activities in human resource
 1) Forecasting future human requirements
 2) Making an Inventory of present manpower resources
and analyzing and assessing the extent to which these
resources are employed optimal.
 3) Anticipating manpower problems
 4) Planning the necessary programmes of recruitment,
selection, training, development, transfer, promotion,
motivation and compensation.

6. 1.1.3 The need for manpower planning
1) Assessing needs
Human resource planning is required to determine whether there is any shortage Or
surplus of persons in the organization.
2 ) For replacement of persons
Large number of employees retire, die, leave organizations and or become inefficient
because of physical mental disorders needs to be replaced
3) Manpower planning ensure a smooth supply of workers by preparing persons for taking
up new positions in such contingencies.
4) To deal with unavoidable workforce turnover
Planning is essential to deal with labour turnover due to voluntary quits, discharges,
marriages, promotions and seasonal function fluctuations in the business.

7. The need for manpower planning (cont)
5) Technological changes
 Technological changes and globalization brought a change
in the method of production of goods, distribution of
products and services and management techniques
6) To meet the needs of expansion and diversification
 No person will be required to take up the new positions.
7) Identify the surplus or shortage of workforce in
organization.
 Identify the areas of surplus personal.
 The surplus personal is the other areas
8) Developing different skills among the employees of the
organization.

8. 1.1.4 Objective of Manpower Planning
Following are the important objectives of manpower planning
 Assessing manpower needs for the future
 Determine training and development needs of the organization
 Ensure required human resources
 Address higher labour costs by identifying situations like overstaffing and
understaffing.
 Relate future human resource to future enterprise needs to maximize the future
return on investment in human resources.
 To increase productivity by optimum utilization of current and prospective workforce
 To provide control measures to ensure that necessary manpower resources are
available
 Development of available manpower
 Anticipating surplus or shortage of staff
 Right number, right kind of people at the right places at the right time doing the right
kind of task.

9. 1.1.5 Levels of Manpower Planning
Plant level
 Manpower planning as a plant level can be conducted by incorporating committee based
on past data and future projections
Departmental or divisional level
 The divisional level integrate all the main power plants of its plant as well as divisional
staff sections
Top level
 Department or divisional plants are reviewed an integrated with man power plants for
head office staff
National level
Sector level
Industry level

10. 1.1.6 Importance of Manpower Planning
 Effective method of learning provides adequate Lead time for the
procurement and training of employees. Manpower planning helps in the
effective utilization of human resources to achieve organizational goals.
Manpower planning is a very important tool for human resource management.
 Increases productivity proper manpower planning helps to increase the skills,
efficiency of the employee and help in decreasing employee turnover
absenteeism.
 Reduced labour cost manpower planning helps the management to find the
weakness of the existing personal through employee performance appraisal. By
arranging training program management can correct the weakness of the
personal which may help to reduce manpower cost.

11. 1.1.6 Importance of Manpower Planning
(cont)
 Increases efficiency in recruitment process the map of planning the manager
of the firm can know the future needs of the employees in the number both
in quantity and quality.
 Improves motivation that the personnel of the future manpower needs
provides an opportunity for training and developing existing personal to
future opening through internal promotion.
 Avoids disruption in production this helps in preparing skilled and qualified
workers on time and ensuring uninterrupted production
 Growth of the organization manpower planning facilitates expansion and
diversification of an organization

12. 1.2 Process, Technique of Manpower
Forecasting
 1.2.1 Introduction
 Every organization needs a work force suitable for its task to
achieve its business goals. To be successful every organization
should assess short-term and long-term staffing needs based on
market expansion, new product launches, projected sales and so
on.
 Human resource focus should include the number of workers
needed, the type of skills required to fill any gaps for
administrative tasks that will be required to increase /downsize
the workforce.

13. 1.2.2 Process of Manpower forecast
ting
 1 Deciding goals or objectives this helps in deciding the required quality and quantity of
human resources to achieve the objectives. Sound manpower planning helps in the
preparation of manual of job classification and job description with specific reference to
individual jobs.
 Estimating the future manpower requirements. Estimating the future manpower
requirement is a crucial part of manpower planning. Forecasting manpower requirement
depends on various factors like level of production, workload analysis, estimated
absenteeism and turnover, demand and supply conditions, Technological changes and so
on.
 Forecasting supply Manpower is essential to meet future demands

14. Supply forecasting measures the number of personnel
available within an organization and outside the organization. It
includes both internal and external supply of workforce.
 Internal supply this is called an audit of internal human resources. It
includes the appraisal of person within the organization. current position they
are skills the potential to handle higher levels of responsibilities their age and
so on. Based on appraisal different training and development programs are
developed.
 External supply sources like Consultants, advertisements, casual
applications, candidates referred by current employees etc.

15.  4) Demand and Supply Comparison
 It refers to the reconciliation of demand and supply
forecast which enables to fill the vacancies at the right
time, with the right employee and therefore this is a very
significant step in manpower planning.
 5) Implementation of Human Resource plan
The organization has to decide the policy finding the
personal. The various implementation program and strategy
include recruitment plan, the redeployment plan, training
plan, productivity plan, retention plan and so on.
 6) Control and evaluation of program
Controlling the activities of human resources needs to be
verified through surplus and shortage of employees.

16. 1 .2.3 Techniques of Manpower forecasting
 Human resource is an important part of any
organization. The techniques of Manpower forecasting
are as follows demand forecasting and supply
forecasting.
 According to Ashwathapa, Human resource demand
forecasting is the process of estimating the quantity and
quality of people required to meet the future needs of
the organization.
 Demand forecasting is affected by several external and
internal factors.

17.  The various demand forecasting techniques are explained below.
 1) Managerial Judgement
 This technique involves two types of approaches bottom up approach and top down
approach. In the bottom up approach to the proposal is brought up by the
line managers to the top managers for the requirement. In a top-down approach
the requirement is first decided by the top managers and then brought it to the
department head for the concert.
 A combination of both approaches it's called as participative approach.
 2) Ratio trend analysis
 This technique involves studying past ratios, the ratio between the number of
workers and sales and accordingly decide the manpower requirement.

18.  3) Regression analysis
 Statistical technique is used to identify the extent of the
relationship between two variables. The forecast is based on the
relationship between the sales volume and the employee size
 4) Work study method
 This technique is also known as workload analysis and is used when
it is possible to measure the estimated workload.
 5) Delphi Technique is used for estimating the demand for human
resources. This technique takes into consideration personal needs
from a group of experts to collect the money for needs and prepare
a report.


19.  Other resources of Human Resource demand forecasting
 Estimation based on techniques of production
 Organization cum succession charts
 Estimates based on historical records
 Floor and mathematical models.
 Forecasting supply
 Internal supply of labour
 Internal supply of human labour resources available by
way of transfer, promotion, retired employee and recall
of laid off employees, etc.

20.  External supply of labour
 The external supply of human resources depend on some factors like
supply and demand jobs, literacy rate of the nation, rate of population,
industry and expected growth rate and levels, technological development
and so on.
 The most important technique for forecasting the internal supply of
human resources is a succession analysis and Marcov analysis.
Succession analysis
 Determining the internal labour supply needs a detailed analysis which
includes a review of skills ability education experience and other
qualifications of existing employees working and different job categories.
the planner that modifies this analysis to reflect changes expected shortly
as a result of retirement, promotions, transfers, voluntary turnovers and
termination.

21.  Markov analysis
 Marco Matrix helps to protect internal employee movement from
one year to another by identifying percentage of employees who
remain in jobs get promoted or demoted, transfer and exit out of
the organization.

 1.2.4 Factors that should be considered while choosing
forecasting techniques.
 Available data
 Stability and certainty
 Time Horizon
 Resources available.

22.  1.3) Factors influencing estimation of Manpower
 Organizational type and strategy
 Growth cycle and organizational planning
 Environmental uncertainties
 Time Horizon
 Information quality
 Labour market

23.  1.4 Barriers to Manpower Planning
 Planning is very crucial activity for any organization.
However there are certain barriers to manpower planning
 Forecasting
 Lack of support from top management
 Expensive and time consuming
 Uncertainties
 Insufficient information
 Lack of a balanced approach
 Resistance from employees
 Lack of integration plan

24.  Requisites for successful human resource planning.
 It must be recognized as an internal part of Corporate
planning
 Human resource planning responsibility should be centralized
for better coordination and consultation between different
management levels
 Support from top management
 Plan should be prepared by skill level rather than aggregates
 Data collection ,analysis of planning and plans must be
continuously revised and improved
 The records of personal must be complete
 The technique of planning should be best suited to the
available data.