Forecasting Hr Needs

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Matching human resources with the present and the future is one of the main problems faced by an organization. Human resources have a certain degree of inflexibility, both in terms of their development and their utilization. It takes months to recruit to select to place, and to train the average employee. In the case of upper management personnel in the organizations, the process may take up to years to nurture the candidate and making sure of the succession are being put in place. Making decisions on recruitment and development are strategic and will produce long-lasting results given the right people are being chosen. Therefore, the management must forecast the demand and supply of human resource as part of the organization’s business and functional planning processes.

Establishing long-term human resources requirements is inter-related to strategic business plans. Strategic business plans should provide a base of information on which human resources plans can be built. Management should also consider the organizations’ labor availability before establishing strategic business plan because plans and decisions are being greatly affected by the employee as most of the saying goes. Employees are the ones that drives the business.

The following figure illustrates the desired reciprocal relationship.

(Alpander, 1982:79)


Upon Establishment of business plans, management needs to estimate future labor availability. To assess the supply of labor, companies needs to see both within and outside of the organization. Also, they will need to determine the future demand of the numbers and types of employees they will require. Here’s a supply and demand analyses that should be conducted separately (Walker, 1980) internally and externally. The main reason for this is that internal supply forecasts tend to rely heavily on the...
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