3-Demand and Supply Forcasting Tools and Techniques

7/27/2019 3-Demand and Supply Forcasting Tools and Techniques

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Demandforecasting

managerialjudgment

Work studytechniques

Delphitechnique.

Statisticaltechniquesa)ratio and

trend

b)regressionanalisis


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1. managerial judgment

2. Work study techniques

3. Delphi technique.

4. Statistical techniques

- ratio and trend

- regression analisis

In most of the cases a combination of methodsmight be more usefull.


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Used in smaller companies

Bottom-up and

Top-down approach

Right-angle method ( combination)


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The concerned persons needs to find out salesforecasts ,work schedules and thus determinethe manpower requirements per unit of

product

In a manufacturing enterprise

Find out master schedule and thendepartmental schedule and it should beconverted into man-hours in terms of differentskills required.


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Eg

a) Annual prodn bgt= 360000 units

b) Standard man power required per unit = 2 hours

c) Planned man-hours for the year (a*b)= 72000

a) Annual contribution of a worker (from past

expeerience)= 2000 hrs

b) No. of workers required c/d = 180


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This figure cannot be relied uponfully ,as the actual prodn is

influenced by many other factorssuch as availability or inputs andpower , break down of machinery ,

strike, lockout etc It is suitable for short term

projections of man power

requirements For long term purpose we can use

workforce analysis


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Work force analysis

It is necessary to keep a sufficientmargin for absenteeism, labour turn

over and idle time on the basis ofpast expeerience.

Keep a amrgine of 20% of

manpower required as per work-load analisis.


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1. Planned output for next year

2. Standard hours per unit

3. Planned hours for the year (1*2)

4. Productive hours per man/year(allowing normal overtime,absenteeism and idle time)

5. Number of direct workers required(3/4)

20,000 units

5

1,00,000

2,000

50


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It is been used in estimating personnelneeds from a group of experts, usuallymanagers.

The HRP experts act as intermediaries,summarizes the various responses andreports the findings back to experts.

The experts survey again after they getthis feedback.

Summaries and surveys are repeated


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a) Ratios and trend analysis:-involves studying past ratiosand forecasting future ratiosmaking some allowances for

changes in the organisation orits methods


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b) Regression analysis :-

It is used when dependent variables andindependent variables are functionallyrelated to each other.

a firm first draw a diagram depicting the

relationship between sales and workforce size.

it then calculates regression line- a linethat cuts right through the centre of thepoints on the diagram.

By observing the regression line one canfind out number of employees requiredat each volume of sales.


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c) Econometric models:- it is necessary toanalyze past statistical data and to

describe the relation ship between anumber of variables in a mathematicalformula.

The variables affecting mathematicalformula may be investment, sales, or thecomplexity of the product line.

Then the formula is applied to forecast

the movement in these variables toproduce a manpower forecast.


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For forecasting supply of human resource weneed to consider internal and external supply.

Internal supply of human resource available by

way of transfers, promotions, retiredemployees & recall of laid-off employees, etc.

Source of external supply of human resource isavailability of labour force in the market and

new recruitment.


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1. Inflows and out flows

Sources of

inflows

No.of

people

Sources of

outflows

No.of

people

Transfer in 12 Resignationsdischarge

132

Promotion

in

10 Corrent

Personnellevel

Demotions,

Retirementspromotion

4

1013

Totalinflows

22 250 operations Total out flows 42


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Turnover rate

=(no of separations during one year/avg no of

employees during the year)* 100


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Data are collected and reviewed for a numberof years in order to estimate the likelihood thatpersons in a particular job will remain in that

job or be transferred, promoted, demoted,terminated or retired.

These historical flows are represented byprobabilities.

The probabilities are arranged in a transitionmatrix and future personnel flows areestimated


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Based on markov analysis the simulationtechnique considers alternative flows which areexamined for effect on future man power

supplies. Alternative flows reflect the anticipated results

of policy or programme changes concerningturnover, retirement, promotion etc.


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In this method supply forecasting is done bycalculating

i. Vacancies created by the organisation and

ii. The results of decision rules governing thefilling of vacancies.

iii. Alternative models may assess the effect of

changes in growth estimates, turnover,promotion etc.


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In this method the planner tends to optimizegoals.

In this case the goal to optimize is the desired

staffing pattern subject to a set of constraintsconcerning such factors as the upper limit onflows, the percentage of new recruits permittedand total salary budget.

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