MHR 523 Lecture Notes - Lecture 3: Scatter Plot, Regression Analysis, Trend Analysis
19 Feb 2017
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MHR 523 – Lecture 3
What is (HR planning) HRP?
o The process of forecasting future human resources requirements to ensure that the
organization will have the required number of employees with the necessary skills to
meet its strategic objectives
o Ensures the organization has the right people with the right skills at the right time
Strategic Importance of HRP
Helps organisations
o Meet strategic goals and objectives
o Achieve economies in hiring new workers
o Anticipate and avoid shortages and surpluses of human resources
o Control or reduce labour costs
The HRP Process
1. Forecast future HR needs (demand)
2. Forecast availability of candidates (supply)
3. Design and implement HR programs to balance supply and demand
Quantitative Approaches to Forecasting HR Demand
o Trend analysis
o Predict future needs based on past employment levels
o Ratio analysis
o Ratio of business activity and number of employees needed
o E.g. sales revenue per salesperson
o Scatter plot
o Graphs used to determine whether two factors (business activity and staffing
levels) are related
o Regression analysis
o Uses a mathematical formula to project future demands based on an establishes
relationship between an organization’s employment level (DV) and some
measurable factor of output (IV)
Importance of Environmental Scanning
o An assessment of external factors influencing the organization’s ability to find and secure
talent from the external labour market including:
o Economic
o Competitive
o Legislative
o Social (i.e. health care, childcare, educational priorities)
o Technological
o Demographic trends
find more resources at oneclass.com
find more resources at oneclass.com
Forecasting Supply of External Candidates
o General economic conditions (interest rates, wage rates, inflation, unemployment rates)
o Occupational market conditions (relevant occupations as applicable e.g. engineers, skilled
labour, accountants)
o Labour market conditions (demographic trends: education levels, age, gender, marital
status)
Methods of Forecasting Supply of Internal Candidates:
1. Skills and Management Inventories
a. Summary of current employee’s and manager’s education, experience, interest
and skills
b. Used to identify eligibility for transfer and promotion
2. Replacement Charts and Summaries
a. Depiction of who will replace whom in the event of job opening
b. Indicates relative strengths/weaknesses, current position, performance,
promotability, age and experience
Markov Analysis
o A method of forecasting internal labour supply that involves tracking the pattern of
employee movements through various jobs and developing a transitional probability
matrix
Matching Supply and Demand
o Available supply of HR exceeds the firm’s demands = surplus
o Supply and demand for HR are equal = equilibrium
o Available supply of HR cannot meet the firm’s needs = shortage
Succession Planning/Key Replacement Chart
o Ensuring supply of successors for key jobs so that careers can be effectively panned and
managed
o Includes:
o Analysis of demand for managers and professionals
o Audit and projection of likely future supply
o Planning individuals career paths, career counselling
o Accelerated promotions
o Planning strategic recruitment
Responding to a Labour Surplus
o Hiring freeze - Opening are filled by reassigning current employees and no outsiders are
hired
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Helps organisations: meet strategic goals and objectives, achieve economies in hiring new workers, anticipate and avoid shortages and surpluses of human resources, control or reduce labour costs. The hrp process: forecast future hr needs (demand, forecast availability of candidates (supply, design and implement hr programs to balance supply and demand. Importance of environmental scanning: an assessment of external factors influencing the organization"s ability to find and secure talent from the external labour market including, economic, competitive, legislative, social (i. e. health care, childcare, educational priorities, technological, demographic trends. Forecasting supply of external candidates: general economic conditions (interest rates, wage rates, inflation, unemployment rates, occupational market conditions (relevant occupations as applicable e. g. engineers, skilled labour, accountants, labour market conditions (demographic trends: education levels, age, gender, marital status) Markov analysis: a method of forecasting internal labour supply that involves tracking the pattern of employee movements through various jobs and developing a transitional probability matrix.
