DEMAND FORECASTING AND SUPPLY

FORECASTING OF HUMAN RESOURCE IN AN

ORGANIZATION
BY
CHARLES J. MWAMTOBE
charzy03@gmail.com

INTRODUCTION
HUMAN RESOURCE PLANNING: The main function of todays managers is to
ensure the clear analyzing and identifying the need for and availability of human
resources so that the organization can meet its intended goals and objectives at a
required time.

Demand forecasting (Manpower Forecasting) is the process of estimating the future

numbers of people required and the likely skills and competences they will need. Forecasting
human resource demand is the process of estimating the future human resource requirement of
right quality and right number. As discussed earlier, potential human resource requirement is to
be estimated keeping in view the organisation's plans over a given period of time. Analysis of
employment trends; replacement needs of employees due to death, resignations, retirement
termination; productivity of employees; growth and expansion of organization; absenteeism and
labour turnover are the relevant factors for human resourced forecasting.
At a more practical level, forecasting demand involves determining the numbers and
kinds of personnel that an organization will need at some point in the future. Most managers
consider several factors when forecasting future personnel needs. The demand for the
organizations product or service is paramount. Thus, in a business, markets and sales figures
are projected first. Then, the personnel needed to serve the projected capacity are estimated.
Supply Forecasting measures the number of people likely to be available from within and
outside the organization, having allowed for absenteeism, internal movements and promotions,
wastage and changes in hours and other conditions of work. The supply analysis covers areas
like: Existing number of people employed by occupation, skill and pontential, source of supply
from within the condition and Effect of changing condition of work and absenteeism
Human Resource supply forecasting is the process of estimating availability of human
resource followed after demand for testing of human resource. For forecasting supply of human
resource we need to consider internal and external supply. Internal supply of human resource
available by way of transfers, promotions, retired employees & recall of laid-off employees.
A Clerk is a person employed in an office or bank to keep records, accounts,
and undertake other routine administrative duties: A clerk is a white-collar worker who conducts
general office tasks, or a worker who performs similar sales-related tasks in a retail environment
(a retail clerk). The responsibilities of clerical workers commonly include record keeping, filing,
staffing service counters and other administrative tasks.
The head of the business means that is any person who has authority and power in
organization to show and provide the direction toward the achievements of organization goals
through initiate various methods and techniques or the accomplishment of the objectivity of
organization. In organization the head of the business is Manager, where by the manager is the
person who responsible for controlling administering all or part of a company or similar
organization.

The following are the major things that managers tend to consider when it comes to
Human resource planning process as the key elements;
Human Resource Planning
Organizations typically plan their future needs for supplies, equipment, building capacity, and
financing. Organizations must also plan to ensure that their human resource needs are
satisfied. Human resource planning involves identifying staffing needs, forecasting available
personnel, and determining what additions or replacements are required to maintain a staff of
the desired quantity and quality to achieve the organizations goals. The human resource
planning function involves at least three different elements: job analysis, forecasting demand
and supply, and legal restraints.
In Forecast demand, Forecasting (Projecting) the number and type of people needed to
meeting organization objectives. A variety of organization factors including, competitive
strategy, technology, structure and productivity can influence the demand for labour. For example
utilization of advanced technology is generally accompanied by less demand for low skilled
workers and more demand for knowledge workers. External factors such as business cycleseconomic and seasonal trends can also play a role in human resource demand
Forecasting demand has two Approaches in explaining human resource planning in the
organization:
Quantitative Approach. Is concerned with determining the number of employees required
in a future period of time, under that approach there are uses of statistical or mathematical
techniques which will be useful in estimating the quantity of man power through work load
analysis and workforce analysis.

Work load Analysis is the total work load of each department estimated on the basis of
sales forecasts, work scheduals, gross rate and expansion plans. As far as possible, the
work load of each department should be estimated in tangible units.
Workforce Analysis is concerned with all existing workers are not likely to be available
for work throughout the year, due to absenteeism and turnover. It is,therefore,necessary to
make a provision for loss of current manpower due to these factors

Qualitative Approach (Skills analysis), the quality of manpower required varies from job
to job. Therefore the quality of employees required for a job can be determined only after
determining the job requirements. Under that approach there is less statistical mathematical,
which will attempt to reconcile the interests, abilities and aspiration and individual employees
with the current and future staffing needs of an organization but it rely on experts who assist in
preparing forecasts to anticipate staffing requirements.

In Forecasting supply Forecasting supply involves determining what personnel will be

available. The two sources are internal and external: people already employed by the firm
and those outside the organization. Factors managers typically consider when forecasting
the supply of personnel include promoting employees from within the organization;
identifying employees willing and able to be trained; availability of required talent in
local, regional, and national labor markets; competition for talent within the field;
population trends. Under forecasting supply there are internally and externally factors for
organization in supply of human resource
Internal supply forecast is a succession planning or the career plans archest rated by
organization. This step is vital as it conveys an inventory of the firms current and projected
competencies. These internal factors are:

Employee turnover rates, refers simply to the movement of employees out of an

organization. It is a determinant of labour supply. As employees turnover, the
supply of labour goes down
Skill inventories (Talent inventories) prepare list of employees showing each
employees education, past experience, vocational interests, specific abilities and
skills and job ternure.Confidentiarty is vital in setting up such inventory we
prepare an up to date skill inventories allowing an organization to quickly much
forthcoming job opening with employee backgrounds. When data a gathered on
managers, these inventories are called management inventories
Succession planning is the process of identifying developing and tracking key
individuals so that the May eventually assume top level position. Succession plans
may be developed for management employees, on management employees or
both. The process for developing such a plan includes setting a planning horizon,
identifying replacement cad indents for each key position, assessing current
performance and readiness for promotion, identifying career development needs.
The overall objective is to ensure the availability of competent executive talent in
the future.

External supply consists of those of individuals in the labor force who is potential recruits of
the firm. The skill levels determine the relevance of the labor in a global way. When an
organization lacks an internal supply of employees for promotions, or when the organization is
staffing entry level positions managers must consider the external supply of labor. Factor that
influences external supply for labor are;

Demographic changes in the population

National and regional economic
Education level of the workforce

Demand for specific employees skills, this happen when organization plans to have
employees with different skills. For instance in an organization such as private school a
management can decide to forecast supply of labor with different skills i.e. it plans to have
teachers with skills of teaching but also computer skills. Other skills such as engineering,
accountant and others they may required according to the needs of the organization.
Population mobility and government policies, migration of the people can led the
management to forecast the supply of labor due to migration of people with high skills,
performance from one place to another. Also according to government policy an organization can
forecast supply of labor by establishing different policy and regulation on how to get and treat
labor. Example of the policy are minimum wage, fiscal policy etc.
Henceforth in the process of supply forecasting and demand forecasting there is balancing
supply and demand consideration that are based on forecasted trends in business activity, supply
considerations involve the determination of where and how candidates with required
qualifications are to be found to fill the vacancies. In an effort to meet the demand for labour,
organizations have several staffing possibilities; Hiring full time employees, having employees
work overtime, Recalling laid-off workers.

REFERENCES

GUPTA. C.B. (2006). Human Resource Management 7THEd, Sultan Chand and sons
Educational Publishers: New Delhi
Robinns,S.P. (1982).PERSONNEL, The management of Human Resource 2 nd
Ed.Prentice-Hall,United State Of America
BEARDWELL. I ,CLAYDON. T and HOLDEN. L.(1994) Human Resources
Management
Gupta, C.B. (2009).MANAGEMENT THEORY AND PRACTICE. New Delhi .Sultan
Chand&Sons.